Employment: Pathways to Work

Baroness Murphy: asked Her Majesty's Government:
	How the £360 million to be invested in extending the Pathways to Work programme to all parts of the United Kingdom by 2008 will be distributed.

Lord Hunt of Kings Heath: My Lords, we are still working on plans for the national rollout of Pathways to Work. They will be announced in due course.

Baroness Murphy: My Lords, I thank the Minister for that somewhat helpful reply. How much of the extra millions will be devoted to the better training of Jobcentre Plus staff, personal advisers and medical assessors, particularly in mental health problems? Is he aware that 40 per cent of incapacity benefit recipients have as their main problem a mental health problem, that 60 per cent of employers admit that they would never knowingly employ someone with a mental health problem and that there is evidence of very poor training in and understanding of mental health problems by staff across the board?

Lord Hunt of Kings Heath: My Lords, I cannot give the noble Baroness the breakdown of figures that she requires. I am not sure that when we come to announce the full plans for the rollout we will be able to break them down to that extent. I very much agree with the gist of the noble Baroness's question. The latest figure that I have is that, for 2005, 39 per cent of incapacity benefit claimants were classified in terms of mental and behavioural disorders. Clearly, there has been considerable growth in the number of people claiming IB in that category.
	The experience from the Pathways to Work pilots so far is encouraging. There is no question that people with mental health issues have been supported back into work. Pathways to Work staff are fully aware of mental health issues and the encouragement that they can give. If we can work on the encouraging outcome of the current Pathways, there is a lot that we can do for people with mental health issues.

Lord Rix: My Lords, does the answer that the Minister has just given with regard to percentages and figures for mental health problems apply to people with learning disabilities as well?

Lord Hunt of Kings Heath: My Lords, the noble Lord has raised the question of the classification used in the Pathways to Work pilots and the classification of people coming on to incapacity benefit. At the moment, we use international classifications, which do not allow for a separate classification for people with learning disabilities. We are concerned about that, and we continue to work with officials to see whether we can find a way through.

The Earl of Listowel: My Lords, to what extent do jobcentre employees have continual professional development available to them and to what degree do they have access to supervision? Those are rather technical questions. Perhaps the noble Lord would prefer to write to me.

Lord Hunt of Kings Heath: My Lords, I am happy to write to the noble Earl with the details, but, in general, the experience of the Pathways to Work pilot shows the dedicated support given by the staff employed there through work-focused interviews and then through a series of programmes that can encourage people to consider work and support them back into work. In the Pathways to Work pilots there has been a 25 per cent increase—an 8 percentage point increase—in the number of people going back into work and coming off IB. That is enormously encouraging and would not have happened without dedicated and well trained staff.

Lord Skelmersdale: My Lords, that is all very well, but claimants taking part in the Pathways to Work pilots have been described as "soft targets", because they are either new claimants or long-term claimants who have volunteered to take part. What confidence, therefore, have the Government in getting other groups off benefit and back into work? Secondly, why is the number of claimants that contractors can take on capped? Surely the Government should encourage a successful contractor and not prevent it taking on any more claimants.

Lord Hunt of Kings Heath: My Lords, on the second point, the noble Lord will know that in the Green Paper on welfare reform the Government propose to increase the number of private sector and voluntary sector contractors. So we wish to see an expansion in the ability of people to provide such services.
	With regard to whether the experience of Pathways to Work can be extended to existing claimants, the noble Lord is right to say that most existing claimants on the programme so far have been allowed to volunteer for it, and 10 per cent of people going through the programme have been existing claimants. However, from February 2005, pilot districts extended Pathways to some existing incapacity benefit claimants of approximately one to three years' duration. So we are confident that the work of and the outcomes from the Pathways to Work programme will in general work successfully with existing claimants.

Lord Oakeshott of Seagrove Bay: My Lords, does the Minister accept that we on these Benches fully support the national rollout of Pathways to Work, but can he be sure that the £350 million of resources for it is sufficient, particularly given the report of the Institute for Public Policy Research which suggested that as much as £500 million would be needed to roll out the programme properly?

Lord Hunt of Kings Heath: My Lords, up to financial year 2005–06, we spent about £150 million. Without the extension of the rollout, we expect to spend another £484 million. On top of that is the £360 million that we announced in the Green Paper. We expect that money to produce what we said it would produce.

Lord Ashley of Stoke: My Lords, does my noble friend agree that Pathways to Work has been one of the great success stories of this Government? It has a crucial role to play in welfare reform, but the only disappointing aspect of it has been the slowness of the rollout. The quicker that we can get on with the national rollout, the better that Pathways to Work can function alongside the Government's welfare reform programme.

Lord Hunt of Kings Heath: My Lords, I am grateful to my noble friend for his encouraging remarks about the progress of the Pathways to Work pilots. I accept his point that we need to speed on with this, but it is equally important that we get it right. We have learnt lessons as we have moved along. We will begin seven more pilots in April 2006 and a further three in October 2006. As I said in my main Answer, we will announce further rollouts in due course.

The Countess of Mar: My Lords—

Lord Rooker: My Lords, with respect, we must move on. We are in the eighth minute.

EU: Arcelor Steel

Lord Lamont of Lerwick: asked Her Majesty's Government:
	What representations they have made to the governments of other European Union member states concerning the proposed bid for Arcelor Steel by Mittal Steel.

Lord McKenzie of Luton: My Lords, the Government have made no such representations.

Lord Lamont of Lerwick: My Lords, I thank the Minister for that reply. Does he agree that the remarks of the President of France and the Prime Minister of Luxembourg about the undesirability of the Mittal bid for Arcelor are wholly inappropriate interference in a matter that should be left to markets? Bearing in mind the actions taken by the French Government to protect Compagnie de Suez from an Italian bid and the actions taken by the Spanish Government to protect Endesa from a German bid, is it not time that we made clear to the governments of Europe that, if we are to have a single market in Europe, politicians should not interfere in such matters but they should be left to laws and markets?

Lord McKenzie of Luton: My Lords, I agree with the thrust of what the noble Lord has said. It seems to me that the paradox of protectionism is that it destroys that which it seeks to protect because it acts against innovation and investment. Government policy is that mergers are the responsibility of the relevant independent competition authority. In the case about which the noble Lord has asked a Question, it is likely that that will be the EU and therefore the Commission will have responsibility, although I do not think that that is settled yet—it depends on the thresholds. However, we believe that governments in Europe should stick by the rules. It is important that they do so if, as the noble Lord says, we are to have a proper market that operates transparently.

Lord Brookman: My Lords, I declare an interest as an ex-general secretary of the steelworkers' union, the Iron and Steel Trades Confederation, now renamed Community. I would probably disagree with the noble Lord, Lord Lamont. We are talking here about people's jobs in Europe, and I do not necessarily disagree with countries that have a degree of concern about this hostile takeover bid. What would we do in similar circumstances? Would we raise the roof if our people were likely to lose jobs? Mr Mittal has a bit of a track record. Some of us remember what happened to Irish Steel. He bought it for one punt and walked away and left the Irish Government to deal with the losses suffered by the people in Ireland. What would our Government do in similar circumstances?

Lord McKenzie of Luton: My Lords, I acknowledge my noble friend's expertise in this sector, but I stress again that we believe that, if such a bid were made for a UK company, it would be the responsibility of the relevant competition authority to consider the effects on competition, including compatibility with well functioning markets and benefits to the consumer. Jobs could well be protected in the short term but, in the long term, companies will not survive in the global environment if they put up barriers that are not sustainable. As I said, that will act against innovation and investment.

Lord Razzall: My Lords, does the Minister remember the criticism that came from the Tory opposition Benches when Her Majesty's Government— particularly the Prime Minister—were alleged to have interfered in Mittal Steel's bid for a steel company in Romania? Does he agree that, in those circumstances, the Question of the noble Lord, Lord Lamont, is slightly strange and that the Prime Minister's answer—that no representation should be made—is best?

Lord McKenzie of Luton: My Lords, I was not in your Lordships' House when that situation arose and therefore I am not familiar with what the Conservative Benches said on that occasion. However, the Government, including the Prime Minister, responded at length to the criticisms at the time, and it is probably best left there.

Lord Hannay of Chiswick: My Lords, will the Minister confirm that there is no basis in European Union law for a member state government to intervene in a takeover bid such as Mittal has launched for Arcelor unless they are a shareholder—and then only to the extent of their shareholding—and that the French Government, who are not a shareholder, therefore have no locus in the business?

Lord McKenzie of Luton: My Lords, I think that if jurisdiction is with the Commission on this, individual member states have a right to make representations about issues affecting their national interest. Whether the Commission takes those on board is a matter for the Commission, but member states have a right to make representations.

Lord Berkeley: My Lords, is there not a competition commission in France that could look at the matter? Is my noble friend aware of a competition authority in France and will it be independent?

Lord McKenzie of Luton: My Lords, as I said, it is likely that jurisdiction will rest at European level; it depends on the global turnover of the two entities and turnover in particular EU states. Therefore, what happens at national level is not particularly relevant.

Baroness Miller of Hendon: My Lords, as the Minister would not have been in the House on 11 April 2002 when the matter of a tariff dispute with Mittal arose, I will quote what the Government said then:
	"the Government are determined to stand by our steel producers".—[Official Report, 11/4/02; col. 524.]
	Assuming that the Mittal organisation is properly described as a British steel producer, will the Government co-operate with the Indian Government, to whom Mittal originally appealed for help?

Lord McKenzie of Luton: My Lords, I have set out as clearly as I am able the Government's position on the bid: it is a matter for the competition authorities. I am not sure what more I can add. As a Government, we should ensure that we support the authority that has jurisdiction, which, as I said, is likely to be the European Commission.

Lord Stoddart of Swindon: My Lords, does the Minister not think it rather quaint for Mr Chirac to be complaining about a bid when the French have taken over so many industries in this country, particularly in water, the railways and electricity?

Lord McKenzie of Luton: My Lords, some of the current and past activity is a recognition of confidence in the UK economy, and the French and others are right to have that confidence. The UK remains the largest inward investment recipient in the European Union.

Baroness Rawlings: My Lords, I agree with the Minister on competition. Will he therefore agree that there is deep concern regarding an increasing trend towards intervention by various governments in ongoing European cross-border takeover bid situations, such as the Mittal bid for Arcelor? Do the Government believe that this wave of economic nationalism is compatible with a globally competitive, dynamic European economy, and with the principles of a level playing field and better regulation?

Lord McKenzie of Luton: My Lords, I do not think that it is. I have set out the Government's position on protectionism. I do not believe that it should play a part in an emerging global economy.

Biological and Toxin Weapons Convention

Lord Archer of Sandwell: asked Her Majesty's Government:
	Whether they will put forward proposals at the review conference of the Biological and Toxin Weapons Convention in November 2006.

Lord Triesman: My Lords, the Government's objective at the review conference of the Biological and Toxin Weapons Convention will be to strengthen further the convention. Later this month, we expect the EU to adopt formally a common position for the conference that will set out the EU's aims, including its plans to submit specific, practical and feasible proposals to the states parties of the convention for their consideration. The Government are also considering whether to submit further proposals nationally.

Lord Archer of Sandwell: My Lords, I thank my noble friend—and not just conventionally—for that encouraging Answer. Since the Council of the EU has already adopted the joint action plan, which envisages the provision of financial resources to universalise the convention and supports its implementation by member states, is not this the moment to propose the establishment, at long last, of a secretariat to promote exactly those objectives, together with the scientific advisory committee that the Royal Society has recommended?

Lord Triesman: My Lords, my noble and learned friend will know that the Government are fully committed to strengthening the convention. We are well aware that there is considerable support for the establishment of a scientific advisory panel and a secretariat among some states parties. These are interesting ideas, and we are very ready to discuss them, possibly as part of the follow-on work programme. The UK does not oppose a formal secretariat; our priority at the review conference will be to support proposals that are feasible and add value to the effective implementation of the convention.

Lord Garden: My Lords, after the last review conference four years ago, the Government produced a Green Paper on the biological weapons convention with a list of useful proposals for the way ahead. How have they been developed in the past four years, and, in particular, will the Government press their idea for a new convention on the physical protection of dangerous pathogens?

Lord Triesman: My Lords, we have carried the arguments forward with a number of the states parties; we did so with particular energy during our presidency of the EU. We have discussed verification arrangements, security assurances and standards for safeguarding materials. I believe that we have made a valuable contribution in raising the issues in general and beginning to move towards more specific outcomes.

Lord Hannay of Chiswick: My Lords, does the Minister agree that two key issues for the review conference will be, first, how far to verify by inspection that the commitments of all signatories to the convention are being honoured and, secondly, how to prepare all countries, in particular developing countries, to cope with a biological incident? Are those two areas likely to be covered by British and EU proposals?

Lord Triesman: My Lords, both those issues are of considerable importance. The United Kingdom and the EU remain ready to support a new verification mechanism as well as new advisory mechanisms. At the moment there are no signs that the international climate has changed enough to permit universal agreement on verification, particularly given the need for the review conference to operate by consensus. We intend that it should be effective. For those reasons it would have to be universally adopted. We would not support the adoption of a verification mechanism that states could opt out of. We still have a good deal of work to do to encourage everybody to opt in.

Baroness Whitaker: My Lords, technology has advanced quite a lot since the convention was ratified. Does my noble friend feel that reviewing it every five years is adequate? Could he consider tabling proposals for the states parties to review it more frequently?

Lord Triesman: My Lords, there may be an argument for that, although the preparatory work for such conferences takes considerable time. Year by year, we have tried to introduce, through discussion papers in the various secretariat and reviewing mechanisms, ideas about verification and the safeguarding of materials that carry the argument forward. We hope on this occasion that we will also be able to carry forward in an additional paper some work on the responsibilities of scientists. That involves work that is done year by year rather than every five years. I think that, incrementally, that is probably the way we are going to get the job done.

Baroness Park of Monmouth: My Lords, can the Minister tell us whether Russia has fulfilled her commitment to destroy or make safe her biological weapons stock?

Lord Triesman: My Lords, I am not in a position to say what the Russian Federation has done in the destruction of any materials. The federation is of course a co-depository to the convention and, therefore, in our view, has—like us and the United States—special responsibilities. It has continued to make clear its commitment to the convention and has been fully involved and engaged in the intercessional programme that I have just described; we expect it to be fully involved in the review conference. I think that it does not declare the whole of its hand on all occasions in these matters, although we will press it to do so.

Lord Campbell of Alloway: My Lords, if verification is conceded as the kernel of this position, should not negotiations on verification precede all other negotiations? Otherwise, the whole thing becomes nonsense.

Lord Triesman: My Lords, I hope that that is not the case because the reality is that a number of countries are not prepared to proceed as rapidly as we would all wish on verification. I would rather that that were not true, but it is. However, I think that we can move forward in other areas and use our best endeavours to get the verification arguments going in a climate that is generally improving as some of the other issues, which have appeared to be intractable, are in fact being solved. Negotiation can often be a matter of catching a tide as circumstances become more favourable.

Equality Act 2006

Baroness Turner of Camden: asked Her Majesty's Government:
	Which organisations they will consult on the regulations under Part 3 of the Equality Act 2006.

Baroness Ashton of Upholland: My Lords, my honourable friend the Minister for Women and Equality has today published a consultation paper setting out proposals for regulations prohibiting sexual orientation discrimination in the provision of goods and services in Great Britain. A Statement and copies of the consultation paper were laid in the House Libraries this morning. We will be consulting widely with all parties interested in the proposed regulations over the next 12 weeks.

Baroness Turner of Camden: My Lords, I am very much obliged to my noble friend for that reply. I state my interest in asking the Question: I am a member of the National Secular Society and a vice-president of the British Humanist Association. We are anxious to ensure that secular organisations, as well as religious ones, are fully consulted. The Humanist Association, in particular, can see no justifiable reason for exceptions on religious grounds in the regulations, and I ask my noble friend to ensure that the views of secular organisations are taken seriously.

Baroness Ashton of Upholland: My Lords, of course we will be delighted to receive representations from the National Secular Society or the British Humanist Association, and they are welcome to come to see my honourable friend to discuss the issues. However, I should make it clear that we propose that activities closely linked to religious observance or practices that arise from the basic doctrines of the faith should be exempt from the regulations.

Lord Renton: My Lords, will not a vast number of organisations need to be consulted in view of the noble Baroness's original Answer?

Baroness Ashton of Upholland: My Lords, we seek to consult a number of organisations that have a particular interest. I welcome the opportunity to make it clear in your Lordships' House that we are consulting. We invite those who have an interest to come forward. We will be delighted to hear from anyone who has a particular view.

The Lord Bishop of Rochester: My Lords, I am glad that assurances have been given that Churches and other faith communities will be consulted. How will the Government maintain the balance in the regulations between freedom from discrimination and freedom of conscience and of belief?

Baroness Ashton of Upholland: My Lords, our ambition is to discuss that during the consultation with organisations, especially those of faith, to ensure that we respect that balance. As I tried to say in my earlier response, we seek to ensure that activities that are linked to religious observance and practice that come from basic doctrines are exempt, but also to recognise that where the main purpose of an organisation linked to a faith organisation is commercial, it may not be exempt and that where faith organisations are operating on behalf of public authorities, they should be covered by the regulation.

Lord Lester of Herne Hill: My Lords, we greatly welcome the consultation document, as we welcomed the Equality Act itself. We welcome the indication in the document that regulation beyond the employment sphere will be introduced in October. Does the Minister agree that it is important that any exceptions to any part of the equality agenda should not undermine the fundamental principle of equal treatment without discrimination? Perhaps the discrimination law review might tackle harassment, not in a segmented and compartmentalised way, but by considering whether the Protection from Harassment Act 1997 might deal with homophobic or any other harassment.

Baroness Ashton of Upholland: My Lords, I agree with the noble Lord's comments. We are aiming for the regulations to be brought into effect in October. On the discrimination law review, we have an ambition to produce a Green Paper this summer, which we hope will spell out many of the issues. We propose to consider harassment in the way that the noble Lord described in the context of that review, where it is appropriately to be dealt with.

Business

Lord Grocott: My Lords, with the leave of the House, we shall hear a Statement this afternoon. It will come some time after 4.30 pm. My noble friend Lady Amos will repeat a Statement on Iraq.

Criminal Defence Service Bill [HL]

Baroness Ashton of Upholland: My Lords, I beg to move that the Commons amendments be now considered.

Moved accordingly, and, on Question, Motion agreed to.
	COMMONS AMENDMENTS
	[The page and line references are to Bill 64 as first printed for the Commons.]
	1 Clause 1, page 2, leave out line 23
	2 Clause 2, page 3, line 16, at end insert—
	"(ba) provision for the review of such decisions;"
	3 Page 3, line 18, at end insert—
	"(5) The provision which may be made under sub-paragraph (4)(c) includes provision prescribing circumstances in which the person or body reviewing a decision may refer a question to the High Court for its decision.
	(6) Section 16 of the Supreme Court Act 1981 (c. 54) (appeals from the High Court) shall not apply to decisions of the High Court on a reference under regulations under this paragraph."
	4 Clause 5, page 6, line 1, leave out subsection (5)

Baroness Ashton of Upholland: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 1 to 4.
	Amendments Nos. 1 to 3 relate to the appeals and review mechanism that forms an integral part of the scheme being introduced under this Bill. The Government fully agree that there should be a right of appeal to the court where the defendant believes the interests of justice test has been wrongly applied. However, the Government have strongly argued that, where the defendant complains about miscalculation or error in the determination of the means test, an administrative review of the application, not an appeal to the court, was the appropriate mechanism to adopt. Members of your Lordships' House expressed their disquiet at this element of government policy, and tabled amendments to provide for an appeal to the court not only in relation to the interests of justice test, but to the financial eligibility test. Subsequently, the Government tabled amendments in the House of Commons, as I said they would, to reverse the effect of these amendments, so restoring the Government's original policy.
	However, during debates in the other place, the Government have become increasingly sensitive to arguments that determination of the means test might, in some limited cases, give rise to more fundamental issues that go beyond mere concerns about a possible miscalculation. Having listened carefully to these arguments and reflected on the comments made by the noble Lord, Lord Goodhart, in particular, the Government agreed to accept the amendment tabled by the noble Lord's honourable friend Mr David Heath in the other place. This provides the Legal Services Commission with an additional power to refer an issue raised by determination of the means test to the High Court. The Government have taken the considered view that this amendment is a sensible and practical compromise, given the concerns expressed in your Lordships' House about debates on this issue. This outcome has proved satisfactory to those in another place, and I hope that your Lordships will now feel able to adopt the same view.
	Amendment No 4 removes the privilege amendment inserted by your Lordships' House to ensure the maintenance by the Commons of control over public funds.
	Moved, That the House do agree with the Commons in their Amendments Nos. 1 to 4.—(Baroness Ashton of Upholland.)

Lord Goodhart: My Lords, I believe it is for me to speak next on this matter, as it was my amendment which the Government have now overturned in the House of Commons. We have considered the situation, and are content with the Government's acceptance of the amendment moved by my honourable friend, Mr David Heath, in the other place. That disposes of any controversy in this matter.
	I should like the Minister to explain one point which has somewhat confused me. New subsection (5) says:
	"The provision which may be made under sub-paragraph (4)(c) includes provision prescribing circumstances in which the person or body reviewing a decision may refer a question to the High Court for its decision".
	So far as I can see, that paragraph relates to transitional provision. I think that means new subsection (4)(ba). If I am right, this is the sort of technical defect that could be corrected without having to bring the matter back to your Lordships' House. Will the Minister confirm that? I believe that new subsection (4)(ba) refers to the provision for reviewing a decision, rather than to the transitional provision.

Baroness Ashton of Upholland: My Lords, apparently it is the effect of renumbering. Subsection (4)(ba) has become (4)(bc) as a consequence of the changes made in another place.

Lord Goodhart: My Lords, it occurred to me that that might be the answer, but I was not absolutely sure it was. If the Minister reassures me that that is the case, I am happy.

On Question, Motion agreed to.

National Lottery Bill

Lord Davies of Oldham: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved accordingly, and, on Question, Motion agreed to.
	House in Committee accordingly.
	[The CHAIRMAN OF COMMITTEES in the Chair.]
	Clause 1 [Constitution]:
	[Amendment No. 1 not moved.]
	Clause 1 agreed to.
	Clauses 2 to 5 agreed to.
	Clause 6 [Licensing structure]:
	On Question, Whether Clause 6 shall stand part of the Bill?

Viscount Astor: I apologise for being in a slight rush. The preceding business went marginally faster than I had expected.
	Clause 6 is about multiple licences. I understand that not only the current operators of the lottery but any possible future operators would think that multiple licences were a bad thing, as they would muddle the whole basis of the lottery—they would not give clarity—and they would not enable the amount of funds required to be raised. Why do the Government think that the provision is necessary? Do they not agree with all those who are involved in the business of managing the lottery, who all seem to regard this power as unnecessary? I look forward to hearing the Minister's reply.

Lord Davies of Oldham: I am grateful for the breathless way in which the noble Viscount asked his question. The clause is about a single licence, not many licences, but I will certainly seek to meet the points that he accurately made.
	The Government's clear and firm presumption is that a single licence will be issued to run the National Lottery, awarded by competition. I cannot emphasise too strongly that that is the Government's clear policy, which was reached after considerable discussion in the wake of the previous competition. We believe that the National Lottery Commission is preparing very competently for the award of the third licence some time next year. We are optimistic that there will be a good competition and a successful outcome.
	Even though that is what we want to happen, we cannot, of course, guarantee it. We have therefore decided that, in the extreme and unwelcome circumstance of an unsuccessful competition—and mindful of concerns expressed by the Public Accounts Committee, which drew attention to this issue on the second licence competition—we need a fallback position, which Clause 6 provides. It gives the Secretary of State the reserve power to introduce a new licensing structure, set out in Schedule 1, whereby more than one licence can be issued to promote lotteries forming part of the National Lottery. We do not say that this is the best outcome—after all, it is a fallback position—but we believe it offers the greatest alternatives scope for the combination of innovation and efficiency that the lottery requires if it is to remain successful.
	If the Secretary of State needs to take action, she will make an order under Clause 6 for Schedule 1 to take effect, but only after consulting the National Lottery Commission. That statutory instrument may bring in Schedule 1, in whole or in part, and would be subject, of course, to the negative assent procedure in both Houses.
	Schedule 1 sets out how a system of more than one licence may work and the consequent changes to existing legislation—in the main to the National Lottery Act 1993. Paragraph 4 of the schedule replaces Sections 5 and 6 of the Act with a new structure for the licensing and operating of games. Specifically, it covers matters such as the procedure for granting applications and how that relates to the competition. The key change relating to this fall-back option is in the proposed new Section 5.
	I could go through the total justification for the clause, which we debated on Second Reading, but I think I have established its main purpose in response to the noble Viscount's abbreviated comments on it. I hope he is satisfied that the clause should stand part of the Bill.

Viscount Astor: I am grateful to the Minister for his reply. It adds clarity to the debate that we had on Second Reading.
	However, I have concerns about multiple licences. I do not know whether the Minister ever receives e-mails but I occasionally receive one informing me that I have just won the EuroMillions lottery. I had one today which states, "You have just won €870,000.79". I am told that when you reply to these e-mails and say, "Thank you so much; please send me the money", you are sent a message saying, "Please send your bank account details and a cheque or draft for £2,500 before you can collect your prize". It is clearly a con. I do not expect the Minister to give me an answer today but it would be useful in our debates and as we move forward on the Bill if the Minister could at some point come up with an answer or write to me explaining what, if this is illegal, the Government or the National Lottery Commission are going to do about it. Clearly, some people will think that they have won a prize. Not only will they be disappointed; they could easily be out of pocket. I do not expect the Minister to answer me now but perhaps, if he has a moment, he could look into it. I thank him for his explanation of the clause.

Clause 6 agreed to.
	Schedule 1 agreed to.
	Clause 7 [National Lottery Distribution Fund: apportionment]:

Viscount Astor: moved Amendment No. 2:
	Page 5, line 13, leave out "prescribed"

Viscount Astor: The amendment relates to the Government's powers in regard to the Big Lottery Fund. We are concerned about the word "prescription", which seems to add an extremely more powerful set of words than has ever before been connected with the distributing bodies. We think that the lottery distributors should be guaranteed a level of independence free from interference from the Government.
	One of the difficulties with the lottery is that we all have views about what organisations the various distributing bodies should or should not give to. One of the advantages of handing that responsibility to the distributing bodies is that we can all complain when they give to organisations that we do not like and we can all applaud when they do things that we do like. That is its nature and it is a good process. We are all bound to have a different view. However, I am concerned that now that we have the Big Lottery Fund, which will receive 50 per cent of the funding coming out of the National Lottery, its remit is getting very close to core government spending. After all, the Big Lottery Fund will have a remit for health and education, and in effect there will be increased government control over it.
	The Minister's argument on Second Reading, and the argument that now faces us, is that this is a light-touch Government and that the power is a reserve one which we do not need to use. If that is the case, it seems to me that we should go back to the words that have served us well in the nearly 10 years that the distributing bodies have been in place—that they must "take account" of the Secretary of State. That seems much better, because it gives them that independence. I do not understand why the Government need the word "prescribed", which seems unnecessary and heavy-handed and raises all kinds of issues that will affect our debates as we progress through the Bill, for example on things such as additionality.
	If we are to be persuaded later about things such as additionality, we will have to have a glimmer of understanding of why the Government want this power of prescription. As soon as they put it there, we think, "This is a way, through the back door, of breaking the concept of additionality". In practice, although the Government pay lip service to that concept, it is increasingly being broken, as we heard on Second Reading from the noble Lord, Lord Clement-Jones, and from the other place. We would like to see less of that, not more. I therefore think that Amendment No. 2, by deleting the word "prescribed", would be a welcome addition to the Bill. I beg to move.

Lord Clement-Jones: My Lords, on these Benches, we strongly support both Amendment No. 2 and Amendment No. 4. Perhaps it is worth while expanding on the principles that we believe should apply to the Bill. In essence, we agree with the National Council for Voluntary Organisations about the underpinning principles for the National Lottery and the funding to the distributing bodies. First, the lottery should be independent from government but accountable to Parliament. Lottery distributors should have the freedom and independence to take final decisions on both funding and specific priorities, after consultation. That is what these two amendments are about.
	Secondly, lottery funding should be additional. We debated that at length on Second Reading, and I have no doubt that we will debate it further in Committee. Lottery funding should be additional to what should be properly funded from general taxation and not a substitute for it. It should not be used to fund essential services or government-inspired programmes.
	Thirdly, we very much agree with the principle of sustainability. Lottery distributors should support the development of a sustainable funding environment for the voluntary sector. In particular, lottery grants should cover the full cost of the activity being funded.
	Our general approach has been to try to imbue the Bill with those principles. The approach taken by my honourable friends in the other place was strongly aligned to that. We could have argued in the other place for a totally different structure and a totally independent lottery foundation instead of the structure that we find in the Bill. Certainly, that would have many attractions and would get round some of the problems of additionality and some of the issues of independence from government. We could have argued for a return to the pre-New Opportunities Fund situation, and I believe that an amendment is coming down the track on that. We chose not to do that. Nor did we argue, as we could have done, for the status quo, with the current proportion of the lottery fund taken by the New Opportunities Fund. We took the view that it was the responsible thing to do to accept the reality that the Big Lottery Fund was set up in 2004. We are effectively dealing with a fait accompli, difficult though that may be to accept when a Bill is passing through this House at such a late stage in proceedings. We therefore took the view that we would be constructive within the general framework of the Bill and that we would try to follow the principles that I have outlined.
	We agree with the noble Viscount, Lord Astor, that the Bill constitutes an unprecedented and unacceptable level of government control over lottery funding. It allows the Secretary of State to prescribe amounts, purposes and periods of lottery funding. These powers undermine the independence, and indeed the perceived independence, of the new lottery distributor, and compound existing concerns about the relationship between lottery funding and political priorities, which are at the root of many of the amendments tabled. We believe that the amendments will significantly reduce levels of government control over lottery funding and provide significant reassurance for the voluntary and community sector, which is very much needed.

Baroness Pitkeathley: I declare an interest as the former chair of the New Opportunities Fund. I do not see that the amendment is necessary. Based on my experience, I read the word "prescribed" rather differently. I think everybody agrees that the amount of government prescription for the New Opportunities Fund is greater than is proposed for the Big Lottery Fund. It is clear how the Big Lottery Fund is operating. But even in that situation, I experienced no interference with specific expenditure. The DCMS gave broad policy directions to the New Opportunities Fund; it did not prescribe the actual amounts or the grants that were made. As I understand it, that is not what is proposed here. The expenditure will be made in the areas detailed in the Bill—charitable, connected with health, education or the environment. I remind Members of the Committee that the proposals for the areas of expenditure have been consulted on very widely by the Government and the Big Lottery Fund.

Lord Clement-Jones: Is the noble Baroness saying that these words which we are seeking to delete are not an extension of government power?

Baroness Pitkeathley: They are not an extension of power; they deal with the large areas where the lottery money should go, not with the actual specific grants and projects which are funded. In my view, the amendments are unnecessary.

Viscount Astor: Before the Minister replies, I apologise to him. When I was moving Amendment No. 2, I should also have said that I was speaking to Amendment No. 4.

Lord Brooke of Sutton Mandeville: I apologise for intervening as the Minister is about to speak, but it is probably easier if I speak before him rather than after. I simply want to say, as none of us had the opportunity to do so after he wound up on Second Reading, that the challenge he threw down to the Opposition—and I have discussed this with him privately—to produce definitions of additionality was against a background where the Government had included a definition of additionality in the Bill in 1993 and then agreed that if the Opposition came up with a better one, they would be prepared to accept it. On this occasion, we are not seeing the Government's definition of additionality—yet, perfectly reasonably, the Minister has made the challenge. Therefore, the situation is somewhat different.
	A thought has only just occurred to me in terms of the long history since 1997; I should have intervened on the noble Baroness, Lady Pitkeathley, but the noble Lord, Lord Clement-Jones, did so first. Did the Government determine that something was additional expenditure when they selected the subjects to pass on to the New Opportunities Fund or did the New Opportunities Fund have to decide whether expenditure was additional? If the Minister is able to answer that question, it would add to the knowledge of all of us.

Lord Davies of Oldham: I am grateful to Members of the Committee for their contribution to this debate. We have at least one other group of amendments—possibly two—in which additionality will be discussed at greater length. With great respect to the noble Lord, Lord Brooke—I do not blame him for getting his shot in nice and early—I am not too sure that the amendments relate directly to additionality, but I shall seek to cover the ground as best I can. I shall address how the Government define the amendments and try to persuade the noble Lords who tabled them not to press them. I am grateful to the noble Baroness, Lady Pitkeathley, who referred to the light touch which the Government used towards prescription in allocation of funds. We intend to follow exactly that model, particularly as—and I emphasise this—we are discussing in this clause a very large fund where prescription would be more remote in any case because of the size of the issues involved.
	Clause 7 creates a new good cause for the Big Lottery Fund, replacing both the existing Community Fund and the New Opportunities Fund. That makes it a substantial fund. More than 50 per cent of the Big Lottery Fund's expenditure on all good causes would be spent within this framework. We are talking about a very large section indeed. Should there not be some area of broad prescription, combined with the light touch which my noble friend identified as obtaining in the past, about an allocation of such substantial sums? Times have moved on since 1993. As the noble Lord, Lord Clement-Jones, said, the Big Lottery Fund creates a whole new dimension. Times have moved on also with regard to devolution. We need some area of prescription to deal with the implications of devolution. I intend to develop that argument in a moment.
	The intention behind the clause—and this is why I resist the amendments—is to make it easier to obtain grants for community purposes by creating a single pot with a single set of rules. That pot will be large and we want a single set of rules for it. We also want prescriptive powers which by definition will be of a general kind. The clause gives the Secretary of State power by order to limit spending in the good cause to certain "prescribed expenditure".
	Amendments Nos. 2 and 4 would take away this capacity for prescription. They would mean—I emphasise the point I was making a moment ago—that the Big Lottery Fund, having been given 50 per cent of all the lottery's good cause money to spend on anything connected with health, education, the environment or anything charitable, would be able to make any of the decisions across this broad area without any further recourse to Parliament. That does not make sense.
	This matter was discussed intensively in another place. As the noble Lord, Lord Brooke, indicated, some of the issues were also raised on Second Reading in this House. However, the arguments have not changed, and I shall set them out again.
	The new good cause is both broad in scope and large in terms of the percentage of lottery money allocated to it. The other good causes—arts, sports and heritage—are relatively narrowly prescribed areas. Within these narrowly prescribed areas, the existing legislation already prescribes sums to be distributed by different distributors. This has the effect not only of limiting who can spend the money but also of restricting what it can be spent on. For example, prescribing the percentage of money to be distributed by the Film Council in effect prescribes the percentage of money from the arts good cause that must be spent on film.
	I give credit to the previous administration in developing the National Lottery etc. Act 1993, when the National Lottery was first established. In 1993, Parliament thought that such arrangements were necessary to ensure the effective distribution of lottery money—namely, prescription over really quite narrow areas. The powers that we are proposing in this Bill are not so different in effect, and we believe that they are as necessary now as they were in 1993.
	I am proud of the fact that new large spending areas of health, education and the environment which this Government created in the 1998 Act are popular with the public and have given the good causes much broader appeal than they enjoyed before. The new Big Lottery Fund good cause brings together these important areas with that of charitable expenditure distributed by the Community Fund, allowing an enormous range of projects to be encompassed. This is a good thing and one of the reasons why we wanted to bring the Community Fund and the New Opportunities Fund together. But it would not be sensible to allocate half of all lottery money to such a broad good cause without any further instruction whatever, particularly when the other half of the money is subject to quite clear and relatively detailed prescription, as established by the original legislation in 1993—legislation that has served us well in those areas.
	That is why we need to set out, at the very highest level, the types of expenditure in broad terms that the Big Lottery Fund should focus on. It is absolutely right that this should be done in a transparent and accountable way, and that there should be proper parliamentary scrutiny. That is why we are very clear this should be done by secondary legislation and subject to the affirmative resolution procedure. Parliament will debate those broad prescriptive powers and the decisions taken under them. Of course, it is always difficult to agree to delegated powers, particularly when they will be exercised with no great degree of certainty. That is why we have made available an illustrative order, demonstrating how the power in Clause 7 will be used in practice. We intend to use the power to prescribe the three high-level themes of promoting community learning; promoting community safety and cohesion; and promoting physical and mental well-being. Those concepts are broad; they are not narrow prescriptions on how money should be spent; they are broader, even, than the terms that my noble friend Lady Pitkeathley used in describing the work she has done.
	The Big Lottery Fund has consulted widely on these three themes, and a majority of respondents agree that they provide an appropriate and flexible strategic framework for future funding. We are talking about broad strategy, not detailed prescription. We also plan to prescribe expenditure on small grants—the popular Awards for All scheme—and on transformational grants. We shall use the order-making power to prescribe devolved expenditure. That will be the responsibility of new country committees, subject to directions issued by the relevant devolved administration. The whole Chamber will recognise the necessity for that within the framework of the devolved administrations and their development. The Bill represents a significant devolution of power to Scotland, Wales and Northern Ireland, and the ability to prescribe devolved expenditure is central to achieving this. Without the power to prescribe expenditure set out in Clause 7, I do not see how the devolution arrangements in the Bill will work.
	I hope that it will be recognised that our two cardinal arguments require us to have some element of broad prescription. This is a very big fund, concerned with 50 per cent of the money to be spent on good causes. The other 50 per cent is subject to a quite narrow definition of the categories. We are not prescribing in detail with regard to this, but dealing with the broadest strategic categories on what prescription should be made. The second necessity for the powers in this clause revolves around the obvious fact that we need some framework for the devolved administrations. That is why I hope the noble Viscount will feel convinced that he can safely withdraw his amendment.

Lord Clement-Jones: I am sure the noble Viscount, Lord Astor, will have plenty to say in reply, but I have a few questions for the Minister before then. He put up a fabulous smokescreen: we had broad strategy, large amounts of money and high-level themes. I am sure the intentions are honourable and all very splendid, but we are actually talking about the Government's absolute powers in the Bill, not so much the exercise of those powers or the intent behind them. Looking at the concordance the Government have so helpfully provided, it is utterly clear that those are additional powers to prescribe in greater detail within those categories. That is the big problem. Why should moving from 33.3 to 50 per cent justify those increased powers? That is what the Minister has not really explained. He has talked in very large terms about the need for such powers of prescription, but in the previous 1993 Act, as amended, those powers do not exist for the New Opportunities Fund. The noble Baroness, Lady Pitkeathley, said that a light touch was exercised by the Government, but the Government did not have the powers that they would have in this Bill. That is the plain fact of it.

Viscount Astor: The Minister said he hoped that he had convinced me. He convinced me of one thing: how much I dislike the concept of the Big Lottery Fund. That is an argument I will reserve until later in the Bill, because I have not given up my campaign to restore the lottery's original four bodies. We will come on to that.
	As the noble Lord, Lord Clement-Jones, said, these are additional powers. There is no doubt about that. When it comes to heritage, sport and the arts, they only have to take account of the fact that the Big Lottery Fund will be prescribed. That is a major difference, and the Minister has not been able to answer on that. His argument is that sport and the arts are more narrowly focused, and so on, but that argument does not particularly hold water. Sporting bodies have to make huge decisions about how they fund different sports throughout the country, and they seem to do so very well. As the noble Lord says, the Government want additional powers because the amount of money coming in will rise from 33.3 to 50 per cent.
	The Minister did not say what the Government's intentions are on this matter, and that is our great difficulty. He says the Bill will cover health, the environment, education and charities, but how is it that the Government have the power to come along to the Big Lottery Fund and say, "We would like you to give this much to charities, this much to health and this much to education"? He said that these would be broad-brush powers. Then he said, "Wait a minute—we're also going to have powers concerning devolved expenditure and small grants", and suddenly went into all the detail about it. Equally, he said the Government would come forward to the House with secondary legislation, but, as we all know, you cannot amend secondary legislation. We can have a debate about it, and we can either chuck it out—in which case the Government will say, "The House of Lords shouldn't be throwing out secondary legislation"—or accept it. We will not have a proper debate. If we are to move forward to some form of understanding, the Minister has to be a bit clearer.
	Clause 7(3C) states:
	"Before making an order . . . the Secretary of State shall consult—
	(a) the Big Lottery Fund,
	(b) the National Assembly for Wales,
	(c) the Scottish Ministers,
	(d) the Northern Ireland Department of Culture, Arts and Leisure, and
	(e) such other persons (if any) as he thinks appropriate".
	The Secretary of State will ask Scottish Ministers, "How much do you want from the Big Lottery Fund?" and they will reply, "As much as possible, please". Everybody will say that. But how will the Secretary of State decide who gets what? What principles will guide his decision-making? I am not asking the Minister to say exactly what anyone will get, not even the exact percentages, but what principles will guide the Government when they decide what to allocate to health, education and the environment? Will they divide the relevant money equally or will they say that one is more important than the other? We do not know and that causes us difficulties.
	These new additional powers allow the Government—they might say that they will not use them—to prescribe expenditure for a certain purpose and a certain region and there is nothing anyone can do about it. One only has to look at Clause 7, which lists the relevant areas and whether the expenditure is charitable or connected with health or education. We need more information on the Government's intentions; otherwise, we shall return to the matter again and again because it raises so many issues.
	It would be helpful if the Minister could add to his reply. However, if he feels constrained in that regard, perhaps he will write to us or we will return to the matter on Report.

Lord Davies of Oldham: I am only too happy to enlighten the movers of amendments in Committee if it is within my power to do so. However, I am not sure that on this occasion it is; hence my hesitancy.
	I spelt out that we were talking about very broad categories indeed. We have already had illustration that under the existing legislation the specific areas are dealt with using a light touch. I indicated that those areas were well defined in good causes. I indicated how the legislation worked. With the creation of so large a body—the Big Lottery Fund, with 50 per cent of the expenditure—it seems sensible to the Government and, I believe, to people whom we have consulted, that that expenditure should have some broad parameters. We are not prescribing details of schemes in regions. The moneys that will be allocated to Wales, Scotland or Northern Ireland will follow a broad-based formula. The one that we are operating at present constitutes an elaborate calculation. If anybody thinks that the Big Lottery Fund would dare to allocate money to Wales, Scotland or Northern Ireland unfairly and without following clear criteria in that regard, they are placing little emphasis on the power of the devolved institutions and the people they represent. The Big Lottery Fund distributors follow a formula, based on census data and various deprivation factors, which determines detailed percentages of funds being allocated to the three countries.
	On the broad issues of policy, I could not have given broader prescriptions. I indicated that community learning, community safety and cohesion, and physical and mental well-being would be promoted. If it is contended that that is a very narrow prescription that the Government are seeking to develop, I emphasise again—I have made this clear—that we will bring these powers before both Houses in an order so that the concepts can be fully examined. I hear what the noble Viscount says about the amendment but he is not talking about narrow amendments to the potential prescriptive themes, as I understand it. He is saying, "You should not have these prescriptive themes in there at all". I say that we need them because this is such a substantial part of the lottery and that we are open and transparent about how we will go about it. I cannot for the life of me understand—even if one accepted that the noble Viscount had a case on prescriptive powers with regard to these themes—how on earth we could take away prescriptive powers with regard to allocation to the devolved administrations. It must be recognised that it is necessary, as this clause envisages, to make prescription in that area.

Lord Clement-Jones: I hear what the Minister is saying about the themes, and he has explained to a greater extent how the Government plan to prescribe or use the powers under the new provisions of Clause 22. He has not really explained why it should not be left to the Big Lottery Fund. Why are the Government prescribing these themes? Why is it not done according to the Big Lottery Fund's perception of the circumstances?

Viscount Astor: We will give the noble Lord two questions at the same time to see how he deals with that. We have a glimmer of light in that there will be a description of broadly based criteria based on a formula based on population. At least we have made modest progress; we know the basis on which the Government will decide what Scotland gets, what Wales gets, what the Isle of Man gets, and so on. However, we have not made any progress—and I never accused the Government of wanting powers to decide who gets what—on how those broadly based criteria will split charitable, health, education and environment themes. Those are the words in the Bill. Will it be equally split? Will there be some formula? What will the Government say to the Big Lottery Fund, and what guidelines will they have on how it should be split up? Either we go down the road put forward by the noble Lord, Lord Clement-Jones, where the Big Lottery Fund makes up its own mind and gets on with it, as happened in the past, or the Government are going to say—because they have the powers—that 50 per cent will be allocated for prescribed expenditure. Within that broad formula, how will they decide, out of these four areas, on roughly the principles of who gets what?

Viscount Eccles: Before the Minister replies, I apologise for not being here at the start of the Committee. As a relatively new boy, I miscalculated the length of time that the previous business would take.
	I add to what my noble friend Lord Astor and the noble Lord, Lord Clement-Jones, have said. What the Minister is telling us is a major change in direction, and I want to be sure that I am reading that correctly. I take one small passage from the policy directions for the financial year ending 31 March 2005. On page 31 of 37 pages, paragraph 9.2, under "Transforming Communities", reads:
	"The Fund shall, by 2006, commit funds to projects that are designed to develop renewable electricity generation"—
	that is environmental, and it is obviously a good cause—
	"Of this £50 million, at least £33 million should be committed to developing renewable electricity generation by building generating capacity for electricity from energy crops, at least £10 million should be committed to building offshore wind electricity generation projects and at least £3 million to small-scale biomass heat/combined heat and power projects".
	That is prescription; I cannot give it any other label. It is incredibly detailed. If you go down to £3 million in a fund that is disbursing £600 million a year, you must be micromanaging. That is a written, clear policy direction. So the Minister is saying that we face a major change in direction and my noble friend Lord Astor is certainly entitled to a fuller explanation of what that change in direction is and how it will operate.

Lord Davies of Oldham: The noble Viscount has described what is going on now—and we intend to change that. So I hope that he will oppose the amendments, because our broader categories will give the Big Lottery Fund greater discretion on expenditure. We are not talking about micro-management, but orders that will come before both Houses of Parliament every three years or so at the most. They will be about broad areas of funding and broad objectives.
	We have indicated the themes. We are merely saying that the argument that appears to come from the opposition Benches is extraordinary. The new Big Lottery Fund comprises 50 per cent of expenditure on good causes. We know that the other 50 per cent will go down narrow, well defined, prescriptive channels, with clearly defined and limited recipients. To say that there should be a free-for all in the other area, and that this House, the other place or anyone else should have no view about such substantial expenditure, and that it should not broadly be prescribed, seems a very odd argument. It is an argument for imbalance and is contrary to what goes on at present, as the noble Viscount, Lord Eccles, elicited from me. It does not stand up to examination. That is why I hope that the noble Viscount will be convinced that I have a good argument.

Viscount Astor: If we follow the Minister's argument and agree to it, the Bill, as he says, will allow the Government to prescribe that 50 per cent can go to charitable areas, health, education and the environment. How will that be split between those four areas?

Lord Davies of Oldham: We are not going to prescribe amounts of expenditure. That would be prescription with a vengeance. The Big Lottery Fund will make the decisions on expenditure, but we will identify broad areas in which it will be appropriate for the fund to encourage schemes to come forward, which it will then support.
	I described the position of the devolved administrations. Solely within that context I indicated that there would need to be a formula of some precision. The one that I described was that used at the present time by the Big Lottery Fund. There is no reason why that formula should necessarily be continued—the fund may decide on others—but it must stand up to the examination of what is reasonable. As I have indicated, the assemblies to which the devolved administrations are responsible would make it clear if they were treated unfairly. It is true that in that area we have figures of some precision. The Big Lottery Fund last year allocated 77.5 per cent to England, 11.5 per cent to Scotland, 6.5 per cent to Wales and 4.5 per cent to Northern Ireland. It was not Ministers but the Big Lottery Fund which made the allocation against explicit criteria on which it could be challenged. I have not the slightest doubt that if that formula is unpopular or unfair, we will speedily know about it from the devolved administrations and their assemblies. With regard to the other issues, I was indicating that, again, it would be for the Big Lottery Fund to divide up the resources. I was indicating broad areas for expenditure, and those broad themes will be covered by an order to go before both Houses.
	I have nothing further to add other than it seems entirely sensible that there should be some way in which the will of the public regarding broad areas of expenditure is identified through the Big Lottery Fund, given the vast resources that it will have at its disposal and given that it will be working in parallel with other good cause allocations in which the prescription is far more obviously defined.

Lord Clement-Jones: The Minister has given assurance after assurance, but does he not agree that the root cause of the problem here is the width of the words in the Bill? I think that we are now beginning dimly to understand how the power will be exercised, but is not the real problem that this power is grossly excessive in the context?

Lord Brooke of Sutton Mandeville: I absolutely bow to the view of the Minister that I was making paving remarks in my earlier intervention. South West Trains was in chaos on Thursday night and some of the chaos has spilt over to today. I was detrained at Basingstoke and have been running behind time ever since, so I am grateful to the noble Lord for having corrected me.
	That said, in the Minister's response to my noble friend Lord Eccles, I could not help noting an admission on the part of the Minister that, in the Government's view, the level of instruction given by government in the previous Parliament was wrong and that on this occasion they should therefore adopt a looser rein. That admission underlines and emphasises every amendment coming from this side of the Committee. We are clearly attacking a target which the Government themselves have just exposed.

Viscount Eccles: Perhaps I may add to that. Obviously, it would be tremendously helpful if we were to conclude that there would not be any more sentences in a policy direction saying, for example, that individuals and individual public libraries shall not be eligible to bid for funds. It is very difficult for us to appreciate the move that the Government are making when the words in the Bill do not make any difference to the position. The position is precisely the same. In fact, the drafting of the directions clause is slightly tighter than that of the 1998 clause and a great deal tighter than the drafting of the 1993 clause. So the position under the law is that the Secretary of State is free to continue with the sort of approach to policy directions in this document, which is 37 pages long, contains 160 significant paragraphs and goes into detail such as I have just read out to the Committee. It is extremely difficult for us to understand that we are faced by a major change in policy. Are we really to believe that?

Lord Davies of Oldham: I am not sure what the noble Viscount is describing. Organisations involved in bids will have very clear indications of policy and of how to meet bid requirements, but, as I indicated, that will be the responsibility of the Big Lottery Fund. I am merely seeking to describe the broad relationship of the Secretary of State to the obligations of the Big Lottery Fund with regard to 50 per cent of its expenditure. I am trying to express to the Committee that in very broad terms the prescription that we are offering is merely to acquaint the 50 per cent expenditure for which the Big Lottery Fund is responsible under good causes on one side with the other 50 per cent for which it is responsible, which is already much more prescriptive because of the channels down which inevitably the resources flow.
	I am indicating that there is no greater government input into the situation than those broad categories; and that this is subject to consideration by both Houses of Parliament in an order. That seems entirely reasonable when the new thing is that the Big Lottery Fund is a substantial part of lottery allocations. It would be very strange indeed to suggest that it should exercise those powers without any form of guidance at all. Within that guidance, we have three broad themes.

Viscount Astor: My noble friends Lord Brooke of Sutton Mandeville and Lord Eccles successfully exploded much of the Minister's argument. He said that when secondary legislation comes here, it can be examined. Well, that is about all it can be: examined. You cannot do anything else in this House. We are concerned about this because subsection (2)(a) of new Section 36E states that the directions may,
	"specify persons to whom the Fund may or may not make grants",
	or may specify the purposes—a whole load of things giving the Government great powers. It is no good the Government saying that they want broad powers, when, if you look at the Bill, it does not stand up. They have given themselves substantial powers.
	I think we have made as much progress—or lack of progress—as we are going to on this amendment. My noble friends and, indeed, the noble Lord, Lord Clement-Jones, and I will have to go away, put on our thinking caps and come back with the same, or a better, amendment. We are not satisfied. It is a concern. The Government cannot have it both ways. They cannot say, "We want only broad powers and are not going to interfere. We are going to have a formula for England". I nearly thought of asking the Minister whether there is a formula for the Channel Islands and how much money is going to go to Sark or Alderney. I am sure that he could do that calculation in his head in a matter of seconds but I will resist the temptation.
	We will come back to this issue. These powers cast a shadow over the Government's intention on the rest of the Bill. That is why they are so important. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Clement-Jones: moved Amendment No. 3:
	Page 5, line 18, at end insert—
	"(2A) After subsection (3) insert—
	"(3A) Not less than 60 per cent of the sum allocated under subsection (3)(d) shall be allocated to bodies (other than public bodies or local authorities) whose activities are carried on not for profit.""

Lord Clement-Jones: The Big Lottery Fund board has given a commitment that 60 to 70 per cent of its funding will go to the voluntary and community sector and that it will report on this commitment. That has been echoed by the Secretary of State and the Minister responsible for the National Lottery Bill, including at Second Reading, in Committee and on Report in the other place. Indeed, Mr Purnell said at Second Reading:
	"We guarantee that between 60 and 70 per cent. of Big Lottery Fund grants will go to the voluntary sector".—[Official Report, Commons, 14/6/05; col. 218.]
	The voluntary and community sector is naturally concerned that the merger of the Community Fund and the New Opportunities Fund could lead to a net reduction in funding for the sector. Therefore, while these ministerial assurances are welcome, voluntary organisations are concerned that they should be meaningful and lasting—that means "in the Bill".
	The Government, however, have rejected attempts to enshrine in the Bill the proportion of funding allocated to the voluntary and community sector on the basis that it is not for the Government to determine. That is slightly contradictory to the previous debate. However, the nature of the charitable expenditure good cause means that the Government have always determined the proportion of funding allocated to the voluntary and community sector. The charitable expenditure good cause is distinct from the others, because it is on the basis of the type of organisation being funded, rather than the activity. Thus, the allocation to this good cause has in fact been an allocation to the voluntary and community sector. We are therefore seeking to have a statement in the Bill that the Government are committed to ensuring that 60 per cent to 70 per cent of BLF funding will go to the sector on an organisational and not a purpose basis.
	We have every faith in the Big Lottery Fund's assurances but it is the Government who make the policy, as the Minister has made quite clear. We on these Benches wish to see an amendment made to the Bill. I beg to move.

Viscount Eccles: Perhaps I may ask about the definition of third sector. Is it the case that there are three sectors: first, the statutory sector; secondly, the private sector, which is the most easily defined by talking about bodies and persons who make and distribute profits; and that the third sector is the rest—the voluntary and community sector? Are there more than three sectors? Or is the definition of the sectors which I have given in shorthand wrong in some way? It seems to me that, in considering the undertaking to support the voluntary and community sector, it is important to understand the boundaries of that sector and, of course, where the other 30 or 40 per cent goes to. I imagine that if we follow down the line of the New Opportunities Fund, the great majority of it will go to local authorities. Am I right in pursuing that definition?

Baroness Pitkeathley: I must take issue with the noble Viscount about the great majority of the New Opportunities Fund going to local authorities. The money from the New Opportunities Fund funded a huge range of projects which gave great satisfaction to those receiving them. Even in the New Opportunities Fund days, at least 40 per cent of its money always went to the voluntary and community sector. As the cash available to the New Opportunities Fund was greater than that available to the Community Fund, in cash terms the New Opportunities Fund contributed at least as much, if not more, to the voluntary and community sector as the old Community Fund. It seems to me that we should accept the Big Lottery Fund's commitment to allocate 60 per cent to 70 per cent of its funding to the voluntary and community sector. I understand that whatever we call it—the third sector, the voluntary sector or the charitable sector—the sector is largely satisfied with both that approach and the way in which that money is proposed. The consultation has been very extensive indeed.
	I should perhaps remind the Committee that even where money appears to go to local authorities, to the health service or whatever, it is very often after consultation and in co-operation as a joint project with the voluntary sector. So I suspect that we will see even more of the money going to the voluntary and community sector than the 60 per cent or 70 per cent promised by the Big Lottery Fund.

Lord Davies of Oldham: If, after our last debate, there was just a slight niggle in the noble Viscount's mind about whether I had satisfied all criteria of his amendment when he withdrew it, let me say that I do not have the slightest doubt that the noble Lord, Lord Clement-Jones, will withdraw this amendment because he will find this reply entirely satisfactory, largely because the Government share his view that it is important that this very substantial sum of money and resources should go to the voluntary sector. I have to say to the noble Viscount, Lord Eccles, that I cannot give him a quantitative division of resources across the country between the categories he has identified. Let me say how it has been approached as far as concerns the Big Lottery Fund.
	The Big Lottery Fund decided to adopt the following definition for the voluntary and community sector in England, Northern Ireland and Scotland. This is not expressed in quantitative terms but in terms of those it deems will be eligible to receive resources. It states:
	"Organisations which are independent from the state, with a motivation derived from values and social purposes rather than the pursuit of profit, and the reinvestment of surpluses principally in pursuit of these values rather than for private distribution".
	All bodies that have those objectives will fit in the category of potential recipients from the VCS when the Big Lottery Fund is allocating resources.
	The noble Lord, Lord Clement-Jones, argues that the requirement to allocate at least 60 per cent of the Big Lottery Fund to bodies whose activities are not for profit should be in the Bill. That would set it in statute. I want to establish with him an understanding that his objective will be realised but that it is not appropriate for it to be in statute. The Committee will recall that we heard substantial contributions on the matter at Second Reading, when both the noble Lord, Lord Brooke, and the noble Baroness, Lady Flather, spoke eloquently about the need for clarity in funding for the sector. My noble friend Lady Pitkeathley is absolutely right, first, to explain how much has been spent in the past on the sector, and, secondly, to say that we expect that at least 60 per cent—more, probably—will be spent on the sector in future.
	That is a matter for the Big Lottery Fund, not for government. After all, we have just had a debate in which the Opposition contended that the Government are taking too many powers to ourselves, when I have said that that prescription is of the broadest kind. Now the noble Lord, Lord Clement-Jones, says that the Government should have backing in statute for imposing that on the Big Lottery Fund. No, we do not accept that argument. First, past practice is a good guide to future behaviour. Secondly, we do not need that in statute because we know how to realise that objective without it being in the Bill.
	Voluntary and community organisations play a vital role in society, often working in partnership with government to deliver essential services, and frequently providing a lifeline for people in need. Such organisations have benefited enormously from the success of the National Lottery, as my noble friend Lady Pitkeathley rightly said.
	The Big Lottery Fund has given an undertaking that more than 60 per cent—between 60 and 70 per cent—of its funding will go directly to voluntary and community sector organisations. That is a higher proportion than has obtained in the past under the New Opportunities Fund and the Community Fund. At present, only the Community Fund's share of the money—one-sixth overall or one-third of the Big Lottery Fund half—is allocated to charitable expenditure. Of course, money from other distributors, including the New Opportunities Fund, goes to voluntary and community sector organisations, but only the Community Fund's one-sixth is guaranteed. We are saying that 60 to 70 per cent will be guaranteed by the framework, because the Big Lottery Fund has undertaken that voluntary and community sector organisations can count on twice as much money as before.
	The undertaking has been given by the boards of the Community Fund and the New Opportunities Fund, operating as the Big Lottery Fund. It has not been given by the Government. Given the arguments that we had on the preceding amendment, I hope that opposition Members of the Committee will recognise that there is therefore an additional strength to the argument. This is a decision, an objective, arrived at by the Big Lottery Fund itself. Of course, we fully support that undertaking, but we do not intend to enshrine it in the Bill. If opposition Members are arguing that there should be less prescription, they must accept that.

Lord Clement-Jones: It might be useful if the Minister responded to me on this matter now, rather than at the end. On 14 June in the other place, Mr Purnell said:
	"We guarantee that between 60 and 70 per cent. of Big Lottery Fund grants will go to the voluntary sector".—[Official Report, Commons, 14/6/05; col. 175, 218.]
	Is the Minister saying that the Government are no longer saying that, and that it is purely a matter for the Big Lottery Fund now?

Lord Davies of Oldham: We are underwriting that, but we are not putting it into the Bill—in our view, for very good reasons.

Lord Clement-Jones: I understand what the Minister is saying, but is he not giving us that assurance?

Lord Davies of Oldham: I thought that I had already done so. If I have not, I am fully prepared to meet that request and confirm that that guarantee is there. But my argument here is not about figures and percentages; it is about whether the percentage should be in the Bill, which is where the noble Lord wants it. If he is merely seeking to test the Government on whether they subscribe to these objectives, I give him that total reassurance. If that is the purpose of his amendment, I hope he will recognise that assurance and feel able safely to withdraw his amendment.

Lord Clement-Jones: I am grateful to the Minister, as I did feel that I had to push him uphill on this. He is always optimistic in these debates, and he is somewhat optimistic now to think that I would simply accept his assurance. Nevertheless, it is extremely welcome.
	The exchange with the noble Viscount, Lord Eccles, was very useful, as were the comments of the noble Baroness, Lady Pitkeathley. The Minister's clarification of what constitutes the voluntary and community sector—or third sector—was also useful, as was his clarification of percentage. In a sense, we are moving on from 40 per cent plus 16 [ 2, which is why it is so important to the voluntary and community sector to have some assurance that the way in which the Big Lottery Fund distributes money will be enshrined in law for the future. In many ways, that is why we on these Benches will not attempt to upset the Big Lottery Fund applecart. As the noble Baroness, Lady ] Pitkeathley, said, there was a great deal of consultation, and I have absolutely no doubt that there will be some very contented voluntary and community sector bodies if all the assurances that the Big Lottery Fund and the Government have given are met. We on these Benches try to reflect what some of the people who brief us and who have an interest in these matters are seeking to do. Otherwise, one would be going back to examining with much greater care precisely why we need this gargantuan body to take 50 per cent of National Lottery funds. So this assurance is of huge importance. That is why we would like it to be in the Bill.
	The Minister had a bit of fun saying that here we were, trying to be over-prescriptive, but it is all a question of how detailed that prescription is. Our objection to the Government's amendment of Section 22 of the 1993 Act was the inclusion of the power to make detailed prescriptions. Nothing in this 60 per cent amendment equates to that. It is very broad, and it is entirely in line with the undertaking that the Big Lottery Fund has given. Indeed, now it is entirely in line with the ministerial assurance. I hope that, at the next stage of the Bill, we will push the Minister a little further along the track. Let us wait and see. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendment No. 4 not moved.]
	Clause 7 agreed to.

Viscount Astor: moved Amendment No. 5:
	After Clause 7, insert the following new clause—
	"NATIONAL ACQUISITIONS FUND
	In section 22(3) of the National Lottery etc. Act 1993 (c. 39) (apportionment of money in Distribution Fund) at the end of paragraph (c) insert "10 per cent of which shall be allocated for a national acquisitions fund, for expenditure on purchasing or conserving works of art, historic properties, archives or other cultural objects of museum quality and national importance,"."

Viscount Astor: I am sorry that the noble Lord, Lord Clement-Jones, says that he does not want to upset the apple cart of the Big Lottery Fund. When one sees certain apple carts, one cannot resist making the attempt. I am certainly not going to give up my attempts to upset the Big Lottery Fund. However, I am afraid that my proposed new clause in a sense puts the cart before the horse because it is predicated on my effort to persuade the Committee to put the lottery back to its original four good causes. Noble Lords may recall that at first there were five good causes because of the inclusion of the Millennium Fund, meaning that each cause received 20 per cent. If my amendment were agreed to, the four causes would each receive 25 per cent, meaning a substantial increase in funding for the National Heritage Memorial Fund. I hope noble Lords will keep that in mind.
	There is an issue about national collections in this country. My noble friend Lord Brooke will remember from his days in the Department of National Heritage that Ministers were always concerned about losing national collections because although there are provisions such as acceptance in lieu, the amount is often ring-fenced by the Treasury. It only takes a death or something similar for a substantial collection to arrive on the Treasury's doorstep all in one year and to cause a major problem. The bodies involved, such as the British Museum and the National Gallery, have put out a call for an acquisitions fund to form part of the National Heritage Memorial Fund. It must be remembered that my proposal would not take money away from the various activities of the fund because, in effect, it is based on the assumption that it will enjoy an increased percentage.
	My amendment, which is probing in nature, asks the Government whether they have considered this issue. What is their response to the call of some of our leading institutions that there should be a fund of this kind? The figures show that the amount of money being spent on, say, preventing art objects going abroad is very small compared with the sums handed out by the Heritage Lottery Fund. I do not criticise that because it is right that it should make its own decisions. I merely recite it as a statement of fact that, for its own reasons, it has felt unable to support such a fund. But what has happened are cases such as that of the recent application for the Canaletto scenes of London paintings to go abroad. Many feel that they should not go.
	Will the Government consider the creation of a national acquisitions fund? I do not know whether this is the right place in the Bill for such a proposal, so this amendment simply tries to ascertain the Government's thoughts on the issue. It is important and the Bill gives us an opportunity to consider it. I beg to move.

Lord Brooke of Sutton Mandeville: I support the probing amendment tabled by my noble friend Lord Astor. I shall make one historical observation about the creation of the lottery and the resources of the National Heritage Memorial Fund as a distributor for the heritage. There were those who felt that, particularly given the amount of money going to the memorial fund, it was to an extent a retrograde step. They were disappointed that the Heritage Lottery Fund would have to make decisions not only about general distribution, but also how its own resources within the National Heritage Memorial Fund should be allocated—particularly because under the old dispensation, before responsibility for the built environment passed from the Department of the Environment to the then Department of National Heritage and now the Department for Culture, Media and Sport, there was always the odd £1 million or even the odd £10 million lying around in the Department of the Environment's coffers as 31 March or 4 April approached. As a result, there was the potential for a bonus for the heritage from those coffers because it was a cause no one could disagree with. The department therefore became a sump for these remaindered extras.
	In the aftermath of 1992–93, after the lottery Bill was passed, there was concern that the National Heritage Memorial Fund's budgetary allocation actually fell. I am conscious that that occurred in the early stages under a Conservative administration. I can see the Treasury's argument that it had this enormous amount of money to distribute qua the lottery because it was a body that had a locus in all four parts of the kingdom. Yet the money which was very specifically its own was going down and was pruned because, as I say, it had access itself to the new lottery money for distribution. The National Heritage Memorial Fund was a particular resource for the crises that periodically occur in national acquisitions. There has been continuing controversy in the years since about how much money the National Heritage Memorial Fund qua itself has received from the public coffers. I strongly support my noble friend's amendment.

Lord Davies of Oldham: I am grateful to both noble Lords who have spoken in the debate. I recognise that this is a probing amendment and I congratulate the noble Viscount on identifying an area that needs to be debated. As he will expect, I shall ask him to withdraw the amendment, but I assure him that we are concerned about this area and that he has raised issues—as, indeed, has the noble Lord, Lord Brooke—which merit reply.
	The importance of this matter is already well understood by the trustees of the National Heritage Memorial Fund, who have responded magnificently to the challenges in this area. I accept precisely what the noble Lord, Lord Brooke, indicated—that one cannot foresee the crises which occur in particularly expensive areas of expenditure—and we all recognise the difficulties of responding to them. The Heritage Lottery Fund has made 451 awards for the acquisition of works of art and cultural objects by museums and galleries, with a total value of £135 million, and its success rate has been over 86 per cent. It has awarded more than £1 billion for the conservation of 9,500 historic buildings. We all recognise particularly significant achievements in these areas. Noble Lords will recall the great debate, great concern and eventual great joy over the possible sale out of this country of Raphael's "The Madonna of the Pinks", which was saved several years ago, Botticelli's "The Virgin Adoring the Sleeping Christ Child", and Stubbs's "Whistlejacket". They are some of the really big items because they ran into millions. In addition to these works of art, which were of national concern and required—and then achieved—national contributions, there have been many smaller items which benefit visitors to museums and galleries up and down the country.
	There are also cultural objects of national importance in industrial, maritime and transport heritage. Noble Lords will be aware of the support that has been given to the "Royal Scot", for example, which certainly captured the public imagination. For a wider public, perhaps, not everything which is treasured is necessarily to be found in an art gallery or a museum. The "Royal Scot", of course, is very much a part of our industrial and transport heritage. The Heritage Lottery Fund has given more than £500 million, which has included the conservation of cultural objects of national importance in addition to the "Royal Scot". These are lottery grants.
	However, let us not forget the grants made by the National Heritage Memorial Fund, to which the noble Lord, Lord Brooke, referred. This is supervised by the same trustees but is, of course, funded by the taxpayer. The majority of the £220 million that this fund has provided over the past 26 years has been for acquisitions of this kind. It has saved more than 1,200 iconic objects and places for the nation—including Tyntesfield House—since the fund was established 26 years ago. Its annual budget will shortly rise from £5 million to £10 million.
	The amendment is drawn so widely that the fund already considerably exceeds the 10 per cent figure. On this occasion, the trouble is that the amendment is unnecessarily restrictive, and could place an upper limit on this activity, which I know that both noble Lords who have spoken agree is a valuable form of expenditure. In addition, who can honestly say that we have any criteria on which to decide whether the figure should be 10 per cent rather than 5 per cent or 15 per cent? How do we know what percentage is required? I would have said that this is above all a responsibility for the trustees, and is not one for us to put in legislation, which might be enabling but could as easily be restrictive in identifying such a percentage. The trustees have the information available to assess the competing needs and opportunities to which they can respond. It is important to reaffirm from the Dispatch Box that we will continue to give the Heritage Lottery Fund the flexibility to respond to the opportunities and at times—inevitably—crises that occur with regard to significant artefacts.
	Were there any question of the issue going to a vote, I would have to challenge the particular figure identified, but as the noble Viscount, Lord Astor, has kindly said, his amendment is probing. I guess that his figure is intended to stimulate debate rather than as a categorical amendment to the Bill. I believe that the Heritage Lottery Fund has demonstrated that it is a sensible and effective team and can be relied on to decide fairly between competing priorities. I do not think that it will be aided by a percentage figure inscribed in legislation, with all the permanence that that would indicate. I do not think that the amendment is necessary, or that it would be helpful as presented. I appreciate, however, that the noble Viscount has taken the opportunity to raise an important consideration, which is foremost in our minds with regard to national lottery funds. We have every confidence that the trustees responsible for this sector of the lottery and its distribution will make the right decisions. I therefore hope that he will be prepared to withdraw his probing amendment.

Lord Brooke of Sutton Mandeville: I am grateful to the Minister for his response. In the spirit of that, I acknowledge that any noble Lords who attended the remarkable exhibition in Edinburgh, in eight rooms of the National Gallery, of the acquisitions made by the National Galleries of Scotland while Sir Tim Clifford has been the director, will be conscious of what can be done through ingenuity and enterprise. The Minister, however, was quoting global figures for the amount that the Heritage Lottery Fund has given towards such issues over a period of years. In the same way that, in advance of Second Reading, the Big Lottery Fund gave us statistics about grants to veterans or their families to go back to the places where they fought, can either the Minister or the Heritage Lottery Fund provide us with a scheduled account of the Heritage Lottery Fund's contributions? That would make it easier for us to judge whether the Minister is right to be so confident that all is well in the garden.

Lord Davies of Oldham: I am grateful to the noble Lord for identifying the canniness of the Scots' art gallery and museum, the successful purchases made and the extraordinary achievements of one man, to which we pay tribute. It goes to show that however generous the allocations of funds, nothing compares with the real advantage of expertise and good judgment in these areas. Of course, I am placing considerable trust in the trustees concerned with these allocations. However, I undertake to provide the noble Lord with the information that he requires.

Viscount Astor: I thank the Minister for giving me a steer on what my amendment should be at Report. He clearly said that it should be an enabling amendment and that I had got my limit wrong—it should be up to 50 per cent. I am grateful for his help and I will redraft the amendment as best I can.
	This debate has emphasised that this is a serious issue. It is not just a matter for works of art that come from private hands. Increasingly, local authorities sell part of their collections. Perhaps I can use this occasion as a plug for the Public Catalogue Foundation which is cataloguing the works of art of local authorities and various other bodies. The quicker that process is done, the less such authorities will be encouraged to sell off some of their works of art. The foundation is not funded by the lottery or by the Government.
	The problem is that the money available can go on just one picture or one statue. The fact that no money is left in the Treasury then puts an undue burden on the National Heritage Memorial Fund. There should be a fund, built up over a period of time, that could deal with these situations. That is not being over-prescriptive; it is saying to the National Heritage Memorial Fund, in the way that the Government can with regard to the Big Lottery Fund, "If you wish, you could set aside some money". We discussed the National Heritage Memorial Fund and unspent balances on Second Reading, and we will go on to discuss interest. Unspent balances could be put aside for situations which will undoubtedly arise.
	This issue is of extreme concern in the heritage world; it is of concern to most of the directors of the national museums and galleries in this country. There is more to be done. I am not sure what the amendment should be, but if the Minister will allow us, we may be able to discuss it further between now and Report. I am grateful for his response and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Davies of Oldham: I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.
	House resumed.

Iraq: Roulement

Baroness Amos: With permission, I should like to repeat a Statement made by my right honourable friend the Defence Secretary in another place. The Statement is as follows:
	"With permission, Mr Speaker, I should like to make a Statement about our operations and force levels in Iraq. First, let me express my sincere condolences to the families of Captain Richard Holmes and Private Lee Ellis of 2nd Battalion The Parachute Regiment killed in Iraq on 28 February; and Trooper Carl Smith who died on 2 February. I am sure the whole House will wish to be associated with these condolences.
	"We express our sympathy too for all those families of the forces of other nations and of the many innocent civilians who have died or been injured as a result of terrorist activity in Iraq in recent months.
	"Honourable and right honourable Members will have been following the situation in Iraq carefully and will, like me, have been concerned about events—in particular, the disgraceful bombing of the al-Askari shrine in Samarra. Some commentators have suggested that that act of terror will lead to a slide into civil war. It is certainly true that these acts of terrorism are cruel and barbaric, but they are not mindless. They have a purpose. It is to undermine the efforts of the vast majority of the Iraqi people who seek peace, stability and democracy in their country; it also has the purpose of breaking the will of the coalition forces supporting them in that quest. Despite the ferocity of the terrorist, the Iraqi people will not be defeated. And our will to see the job done will not be broken.
	"Our analysis is that civil war is neither imminent nor inevitable. But it is the case that in some areas of Iraq, including in Baghdad, there has been an increase in sectarian violence. This is abhorrent and plays to the aims of the terrorists. But, in fact, in the face of the cynical targeting of the Samarra attack, the aftermath has been characterised more by calls for restraint by Iraqi politicians and religious leaders, by the calm reaction of the vast majority of Iraqis—despite their natural revulsion and anger—and the mature response of Iraq's new security forces. These are, in the midst of all the problems that we see, encouraging signs in a very difficult and delicate situation.
	"Our respect and admiration for the men and women of our Armed Forces remain undiminished. The truly magnificent work that they are doing there is having a positive effect, and they have played a vital role in helping Iraq come a long, long way in a short space of time.
	"Suffice it to say, Iraqis have clearly shown us what they want, and it is not a return to fear and oppression. They showed us that most impressively in December, when some 12 million of them—about 75 per cent of the electorate—voted in free and fair elections, despite the threats of death and destruction.
	"The current political wrangling over the formation of a new coalition government is perhaps natural, but it is also contributing to uncertainty and fuelling speculation. As that process moves forward, the Iraqi politicians must not forget the commitment of the Iraqi people, who voted in large numbers to bring order and fair government to a unified Iraq. However, there has also been a continual and considerable advance in the numbers, capability and morale of the Iraqi security forces, which have developed as democracy has developed. It is in this context that I now turn to the UK's troop presence.
	"When I announced the last changeover in October last year, there were 190,000 members of the Iraqi security forces already trained, capable and equipped. Today, I can tell the House that there are around 235,000 members of such forces—45,000 more—and others are joining them at the rate of around 5,000 every month.
	"It is against this background that we assess our troop levels. I can therefore tell the House today that, as a result of this roulement, there will be a reduction of British forces in Iraq of around 800 personnel. This reflects the completion of some of our security sector reform tasks in developing the capability of the Iraqi forces; for instance, in training the trainers and those involved in the guarding of institutions. It also reflects improvements in the way we configure our own forces.
	"Our force levels reflect the in-theatre assessments in the south-east of Iraq. Today's announcement marks a reduction from the high point of some 10,000 UK personnel in October 2003 to just over 7,000 from May this year.
	"The lead formation in Iraq, currently 7th Armoured Brigade, will be replaced in early May by 20th Armoured Brigade. The following major units will be deployed to replace those in theatre today: 1st The Queen's Dragoon Guards; the Queen's Royal Hussars; 12th Regiment Royal Artillery; 33 and 35 Engineer Regiments; 1st Battalion Grenadier Guards; 1st Battalion The Princess of Wales's Royal Regiment; 2nd Battalion The Royal Regiment of Fusiliers, which is the reserve in Cyprus; 2nd Battalion The Royal Anglian Regiment; 1st Battalion The Devon and Dorset Light Infantry; 1st Battalion The Light Infantry; and 3 Logistic Support Regiment Royal Logistic Corps. A number of reserve personnel will accompany this deployment, including soldiers from The Lancastrian and Cumbrian Volunteers, and The King's and Cheshire Regiment.
	"Aviation support will continue to be provided by five Merlin and eight Sea King support helicopters, and four Lynx. In May, there will be a reduction of two Sea King helicopters. Our support to the Iraqi navy and our contribution to the coalition taskforce in the north Arabian Gulf will continue unchanged.
	"Let me stress that the reductions I have announced today are not—I repeat, not—part of a handover of security responsibility at the operational level. They are not caused by, nor a cause of, changes in troop levels of other coalition allies.
	"In the next few weeks, the Joint Committee to Transfer Security Responsibility, a body made up of Iraqi Ministers, military staff and senior coalition figures, will start the assessment phase to look at whether conditions have been met for some provinces in Iraq to begin the handover process. Today is not that stage of handover. When they have reached conclusions, I will update the House on the implications.
	"In closing, I should like to reiterate that we continue, amid the struggles, to make progress in Iraq. Of course, much remains to be done. Let me stress that the reductions that I have announced are not part of a handover of security responsibility. They do reflect the completion of some of our security sector reform tasks, which we set ourselves some time ago, in developing the capability of the Iraqi forces—training the trainers, and guarding institutions.
	"Our commitment to the Iraqi people and their government remains total and steadfast. Our commitment to the coalition is certain. We will stay as long as we are needed and wanted, and until the job is done. Today marks another significant step in that process".
	My Lords, that concludes the Statement.

Lord Astor of Hever: My Lords, I thank the noble Baroness the Leader of the House for repeating the Statement. Sadly, but properly, our first words in response must be to join in the condolences expressed to the families and friends of Captain Richard Holmes, Private Lee Ellis and Trooper Carl Smith. Every time we reflect in sorrow on the death of another British soldier, we are prompted to ask ourselves for how much longer this roll of honour will continue to grow.
	We on this side of the House have consistently supported the Government in their view that there are a number of landmark points that need to be achieved before the UK can appropriately withdraw its Armed Forces from Iraq. We must now say, however, that we are concerned to learn from the Statement that the Joint Committee to Transfer Security has not yet started to assess the extent to which the obvious and attainable landmarks are being achieved—particularly in relation to the readiness of Iraq's own security forces—and that it is not expected to start to do so for some weeks yet. What will be the terms of reference of the joint committee for the assessment of withdrawal? When do the Government anticipate that the joint committee will be likely to reach conclusions?
	Clearly, a crucial factor leading to stability and the drawdown of coalition forces in Iraq is the readiness of Iraqi security forces. Is their recruiting and training proceeding at a level and on a timescale that the Government expect of it? How soon do the Government anticipate they will have reached the level of competency to be able to take over security from coalition forces?
	A paragraph in the copy of the Statement that we were given, which the noble Baroness did not repeat, mentions that, of 118 combat battalions, only 59 currently have the capability to conduct counter-insurgency operations independent of coalition support. I am curious as to why that paragraph was omitted from the Statement that the noble Baroness repeated. When do the Government expect the other half to have this capability?
	Can the noble Baroness tell the House what other coalition countries are doing? How many will be pulling out in the first half of this year? I have in mind Italy and Poland in particular. Will the noble Baroness assure the House that our troops have been given every possible support to deal with the increased attrition from roadside bombs? Are the Government satisfied that our troops are adequately protected in their camps?
	Are Her Majesty's Government satisfied that the US/UK coalition is operating effectively in terms of winning hearts and minds? And are we successful in influencing the US in terms of strategy and tactics on the ground? Are our forces working effectively with US forces in theatre according to the operational doctrine, as deemed most appropriate by British military commanders?
	The Statement reiterates that we will keep our Armed Forces in Iraq so long as they are needed and wanted, until the job is done. We must not leave our troops in Iraq just to be shot at. It is essential that the judgment of the job being done is a British judgment, and not that of anyone else.

Lord Garden: My Lords, from these Benches I add our condolences for the three losses that the British forces have had since we last dealt with the subject of Iraq, and also to the families of others, civilian and military, who have died.
	I am most grateful to the noble Baroness the Leader of the House for relaying the Statement on Iraq roulement. It is perhaps unfortunate that we have to discuss Iraq each time on the back of a Statement. I trust, given that a major change will happen once the joint committee has produced its recommendations, that we will have a full debate at that time rather than just a Statement.
	The Government's approach on Iraq compares unfavourably with the approach on Afghanistan, which has been much more open. We have had welcome consultation, and we have looked at how the enlarged task in Afghanistan is to be carried out. Three years on, with over 100 British troops dead, tens of thousands of Iraqis killed and much of the remainder of the population living in fear of death, torture or both, we need a strategic approach in Iraq, just as we are developing one in Afghanistan.
	In any post-conflict situation the military can only enable the development of the political and economic structures. Military action is not an end in itself. We have called repeatedly for comparative data on how the reconstruction effort is going, and, given the noble Baroness's other ministerial responsibilities, could she tell us today what the electricity availability in the British sector is, and what are the figures for safe water, sewage systems and unemployment—all the key economic indicators that tell us whether we are making progress?
	On the political side, we are all aware of the continuing difficulties of forming a national government. How does that affect the British area of responsibility? Do we have confidence in the local political governance? If not, why not, and what are we doing about it? The reduction in force levels by 10 per cent set out in today's Statement is a significant reduction. Back in November, the Secretary of State said in another place:
	"We have made it plain that we will hand over to the Iraqi security forces when they are capable of defending the democracy that they are building against the terrorists. In order to make that assessment, a committee has been established"—[Official Report, Commons, 14/11/05; col. 675]—
	which would assess the situation. We hear in this Statement that that committee has not started work yet. We have a problem: there is no Iraqi Government and no committee assessing it, but we are reducing forces by 10 per cent. What is the strategy?
	The security problem comes from multiple sources: insurgents, extremists, militias, armed criminals and inter-ethnic conflict. It would be a problem for any western police or military force at home to deal with in their own country. We saw the problems we had in Northern Ireland, a much less hostile environment, and how long it took us to win the confidence and support of all elements of the local population. How much more difficult it will be for the embryonic Iraqi security forces to achieve it. I too noticed, as did the noble Lord, Lord Astor of Hever, the missing part about the 59 units in the Iraqi forces that were assessed as being up to speed. The category in the original draft encompassed those that could do it on their own, but also those that needed some assistance—Level 1 and Level 2, in Department of Defense-speak.
	The critical question for us, which is very difficult for any of your Lordships to answer, is whether the occupying forces at the moment are more of a help than hindrance. It is a not a judgment that we make on party political grounds; nor, I suggest, should it be one that we make consequential on the United States mid-term election timetable. Yet without open, honest, comparable, consistent data, we just cannot make that objective assessment. We on the Liberal Democrat Benches have argued for the past three years that a strategy is needed. Ten per cent troop reductions can be thought of as a tactical matter but we do not know whether it is a wise move in military terms—whether it puts the troops who remain at greater risk. What we do know is that it cannot be consistent with the view that the Iraqi Government would be involved because we do not have the new Iraqi Government. So we on the Liberal Democrat Benches can do no more than note that the United Kingdom Government believe that it is a sensible move.
	Opinion polls in Iraq suggest that we are not winning the battle for hearts and minds. That is not surprising when another opinion poll indicated that 85 per cent of American forces in Iraq believe that they are there to retaliate for 9/11. If that is really what they believe, it is scarcely surprising that we are losing the battle for hearts and minds.
	We support the congratulations in the Statement to our Armed Forces on all they do, but we also have to consider reports on prisoner abuse from organisations such as Amnesty International, which states:
	"The record of these forces, including US forces and their United Kingdom (UK) allies, is an unpalatable one".
	There are balances to be struck.
	I have some specific military questions, on which I am sure the noble Baroness will want to write. It is not clear from the Statement whether the number of reservists is up or down—it just says that it changes. The reservists are finding life in Iraq very difficult at the moment. The number of helicopters is being reduced. Two Sea Kings are being knocked off the number. Yet when you compare the six Chinooks that go to Afghanistan with the slightly rag-bag collection of helicopters in Iraq, it seems odd that a bigger force should have a smaller lift in a more hostile environment. I need to be reassured that reducing it yet further in Iraq is sensible.
	There is no mention of the problems that we have discussed on a number of occasions of air transport and getting the forces out in time. What about medical support? How will that be affected given that the Armed Forces Pay Review Body has highlighted that we are in a critical state, especially as regards nurses in the military? Will the Royal Military Police be reinforced so that investigations can be timely to avoid morale losses? There are many questions that we do not have sufficient time to cover today. However, we listened to the Statement with interest and thank the noble Baroness for delivering it. We wish our troops every success.

Baroness Amos: My Lords, I thank noble Lords for their comments on UK security forces. I wish to deal at the outset with the point about the 118 groups which have been prepared and the 59 which we believe are operationally ready. That was in my original draft. I understand that my right honourable friend did not read out the relevant page in the House of Commons, which is why I did not read it out here. That is in no way sinister. Perhaps my right honourable friend missed the relevant page, so I did, too. I hope that I have not got him into trouble by saying that, but we are very happy to have this information in the public domain.
	The noble Lord, Lord Garden, referred to a strategic approach. I believe that he has misunderstood what we are seeking to do here. We are looking at three phases. The first phase concerns tactical overwatch and the handover of tactical issues. The role of the joint committee is to look at the next phase, which concerns operational overwatch and the point at which we are able to hand over operational responsibility to the Iraqi forces. The decision that was taken today, which will come into force in May, was made following a review of our forces on the ground and as a result of the fact that part of our programme in Iraq involved a huge programme of training the trainers. We have achieved our goal with respect to that and need fewer people to enable us to carry out that role. The other aspect is that the Iraqi forces themselves are increasingly able to take responsibility for guarding duties.
	So there is not a lack of a strategic approach. We hope that the joint committee will meet from April. I do not entirely accept the point made by the noble Lord that there is a lack of government; the transitional government are still operating. Yes, there were difficult negotiations following the elections in December, and the Parliament has not yet met, but there are indications today that the Parliament may meet around the 16th, which would be another important step in the democratic process. Those steps will happen, and they are within the overall strategic approach not only of the Ministry of Defence; we have discussions across government involving the Foreign and Commonwealth Office and the Department for International Development.
	The noble Lord asked specifically about some of the development gains. With help from donors, the interim government negotiated an emergency post-conflict agreement with the IMF, which is worth some $436 million and which is very helpful in terms of putting that money into infrastructure and public service reform. Some $3.22 billion has been spent on electricity, ensuring that the average power generation remains above pre-war levels. That is despite continued sabotage and breakdowns of what was a very dilapidated system and despite the lack of fuel supplies. A new mobile phone network has been introduced, with over 3.5 million subscribers. Some 1.25 million more Iraqis have access to potable water than before the conflict and 9.6 million more Iraqis have access to a sewerage system. More than 30,000 teachers and healthcare professionals have been trained. I am very happy to put what we have done on the development front in the Library of the House; it is on the website already.
	The noble Lord, Lord Astor of Hever, asked a number of questions as well. With respect to what is happening with other coalition partners, the decisions that we have taken today are in no way affected by or affect what other coalition partners are doing on troop levels in Iraq. My right honourable friend has made that very clear in another place. Of course we do all that we can to ensure that our troops are adequately protected; that is our top priority. It has been a difficult task, most recently in terms of winning hearts and minds. As the political process develops, the political situation will become more complicated, because undoubtedly there will be political groups and organisations that seek to exert influence and may well use the fact of the presence of coalition forces in Iraq as a negative rather than a positive—we have to be prepared for that. Having said that, we also have to recognise that coalition troops are in Iraq under a UN mandate.
	We will work very hard to ensure that we are engaging in a positive way in the governance process; the noble Lord, Lord Garden, asked about that. There have been difficulties locally, but some of the difficulties that we have had in Basra and elsewhere with local politicians are now coming to an end and the relationship is much more positive.
	If my memory serves me right, there are some 559 Army reservists; I think that the figure goes up to 629 if we include all three forces. I will write to the noble Lord if I have got that wrong. Decisions on helicopters and air transport were taken after adequate discussion on the ground. They are not political decisions; they have been taken in the round following a review by our military people in Iraq and here in London.

Lord Hurd of Westwell: My Lords, does the noble Baroness accept that there is a wide and, I fear, widening gap between the tone of the Statement that she kindly repeated and the reports that your Lordships and others receive, not just from the media—including newspapers that supported the war—but from all kinds of independent witnesses, whether or not in uniform? That widening gap of perception makes it difficult for this House and reinforces the view from the Liberal Democrat Benches that we need a debate before too long.
	Perhaps I may pin down the noble Baroness a little on the optimistic tone of the Statement regarding the training of Iraqi security forces—she gave a figure of 235,000. As far as the areas in which British troops are involved are concerned, can we take it from what she said that we are satisfied that those Iraqi forces, particularly the police, are independent—that is to say, obeying the orders of the Iraqi Government in Baghdad—and are not influenced, or overly influenced, by local militias with political purposes? Secondly, can she develop her point that our forces are now working closely and harmoniously with the local police and local authorities? If they are not doing that, all the phrases such as "finishing the job" and so on are called into question.

Baroness Amos: My Lords, I hope that the noble Lord will look carefully at the Statement, because I do not think that it was overly optimistic. It tried to strike the right balance between some of the stories that we read in our media about what is happening in Iraq and the experiences of our troops on the ground—and a number of my colleagues have visited Iraq recently.
	On the noble Lord's specific question about training the Iraqi security forces, it is important that the House should recognise and remember that we have always said that this is a process. Not everyone who has been trained to date is yet ready to move to a situation where they can take operational control. Mention has been made of the draft Statement talking about 59 groups being ready to move forward on those duties. We see that process continuing over time.
	The figure of 235,000 includes army and police. The noble Lord will know that there have been concerns about what is happening in the police. If we look at other countries, such as Bosnia, or, indeed, at what has happened in Northern Ireland, we see that it is always more difficult, when there has been a conflict, to reach a stage where the police, who operate at a level that is much closer to the community, can have the confidence of the entire community in governance terms. That is a process that the police are going through in Basra. There have been allegations of corruption; those are being investigated, but it is important to recognise that not every member of the Iraqi police service is corrupt.
	We are seeking to work closely with local authorities, but, as I said in response to earlier questions, my own view is that that may become more difficult as the political situation in Iraq matures and develops. Undoubtedly, there will be forces within Iraq that, within a democratic political process, try to use the presence of coalition forces as a negative, rather than a positive.

Lord Campbell-Savours: My Lords, will my noble friend make it clear to military planners and the joint committee, when it meets, that they should not be tempted into garrisoning or stationing British troops in Kurdistan as part of some long-term strategic plan for the future of Iraq?

Baroness Amos: My Lords, I will certainly make sure that my noble friend's views are known.

Baroness Ramsay of Cartvale: My Lords, does my noble friend agree that the very welcome reduction in British personnel that she announced today reflects not only the increased capability of the Iraqi security forces mentioned in the Statement but also the fact that it is only in four out of the 18 provinces that the insurgents wreak their terrible bloodshed? In most of the rest of the country, there has been a considerable increase in the quality of life enjoyed by ordinary Iraqis, some details of which my noble friend gave in response to Front-Bench comments on her Statement.

Baroness Amos: My Lords, my noble friend is right. Sometimes we forget that point. Although the insurgents continue to target coalition forces, Iraqi civilians and Iraqi security forces, the majority of attacks are confined to four out of 18 of Iraq's provinces, and large parts of the country—in particular, in the north and the south—remain relatively calm. We would do well to remember that. It in no way underplays the difficulty of the security situation in those other parts of the country, but I think that we should see this in the round.

Lord Ramsbotham: My Lords, one worry that certainly continually runs through the mind of the military in this context is the word "sustainment". How long can operations be sustained, bearing in mind the pressure that the Armed Forces are under? We heard only recently of the increased numbers going, for example, to Afghanistan, which must make people wonder what the strain is like and how it might affect sustainment. Of course, we are pleased to hear that the numbers going to Iraq are being reduced, but numbers are not just things in themselves. Can the Minister explain precisely what the figure of 800 means? Is it a major unit, a capability or what? The figure of 800 does not mean anything.
	When I was serving, we always tried to ensure a gap of some 24 months between operational tours so that units had time to train, to refresh themselves, to have time with their families and generally to keep themselves in a state which meant that they could be deployed over and over again. As I listened to the names of the units that the Minister announced, I recognised one or two which are by no means on their first tour of duty in Iraq. Can the Minister say something about the gap between the operational tours of the units which it is announced will go there with 20th Armoured Brigade?

Baroness Amos: My Lords, on that final point, I do not have the information to hand, so, if I may, I shall write to the noble Lord. The decisions taken on the next stage of deployment to Iraq have no relationship with what is happening in Afghanistan. The noble Lord may recall that, when we announced deployment to Afghanistan, the Chief of the Defence Staff made it absolutely clear that that would not cause unacceptable overstretch. Those may have been his exact words. He made it clear that the situation would be tight but that it was not unacceptable. With regard to the 800 personnel, I am happy to send the noble Lord a list of the units that are in Iraq now and repeat the replacement list that I read out. That will give the noble Lord a better indication of what it means.

Lord Chidgey: My Lords, can the Minister be a little more informative regarding the coming on stream of the additional Iraqi security forces? I note from the Statement that they are coming on at about 5,000 per month, which sounds pretty impressive, but can the Minister put that in perspective with the sort of training that we in this country would envisage when talking about training security forces or police forces or whatever? Clearly we would expect our police officers to be trained for some years before they were ready to go into service. So far as I can see, we are not talking about the same thing. Can the Minister be more specific for us?

Baroness Amos: My Lords, if the noble Lord would like me to send him details of the training, which is what I think he is asking me, I should be happy to do so.

Lord Boyce: My Lords, I am sure we all greatly admire the courage and bravery of the Iraqis who stepped forward to become part of the security force apparatus in Iraq. I note from the Secretary of State's Statement in the other place that the number of people joining is 5,000 a month; yet, last year, the increase in numbers of the security forces was 45,000. This implies a lack of retention of the order of 15,000. Can the Minister say something about how well we are retaining Iraqis in the security forces or is retention getting worse in the light of the current situation?

Baroness Amos: My Lords, retention is of course a matter for the Iraqi security forces themselves, but I will do all I can to find that information.
	On the wider question of the training and work being undertaken by the Iraqi security forces, my understanding is that the emphasis is on developing capability, particularly in the key areas of leadership, command and control, intelligence and logistics, all of which will enable the Iraqis to take over control of security themselves.

Lord Roper: My Lords, in the Statement and in her reply to my noble friend Lord Garden the noble Baroness referred to the fact that part of the work of training the trainers had been completed. Can she tell us how many of the 800 are those who have been trainers and how many are not?

Baroness Amos: My Lords, I do not have that breakdown. My understanding is that some of those troops have been involved in training and others in the guarding of key installations. As the Iraqi security forces acquire that capability, it has become possible for us to reduce the number of our own personnel involved in those duties. If I am able to give a better breakdown, I will write.

Baroness Carnegy of Lour: My Lords, at the end of the contribution of my noble friend Lord Astor of Hever, I understood him to say that the length of time our troops stay in Iraq will be a British judgment and nobody else's. Can the Minister confirm that?

Baroness Amos: My Lords, I have made that absolutely clear in the answers I have given. Today's decision has been taken following a review by British military personnel and discussions with British politicians. In the longer term, we have always made it absolutely clear that we will talk not only to our coalition partners but to the Iraqis themselves when making a decision on final withdrawal.

Lord Campbell-Savours: My Lords, can the Minister confirm that the figure of 5,000 she referred to includes the absorption of whole militias? When those militias sign up, do they sign up under the name of the militia or as individual personnel? This is important, because it indicates to whom their loyalties lie.

Baroness Amos: My Lords, we are working towards an Iraqi security service that sees its responsibility as being to the Iraqi people and parliament. That is what the Iraqis are seeking to put in place, but we all recognise that there is a difficult transitional phase. Some of the difficulties identified with the militia and the police services are part of that process.

Lord Campbell-Savours: My Lords, can we pursue this point and find out what these arrangements are? I know that it is difficult for the Minister to know a precise answer at this stage, but it has long-term implications. We should know the basis on which these people are signing up.

Baroness Amos: My Lords, I will be happy to find out that information.

National Lottery Bill

House again in Committee.
	Clause 8 [Reallocation of funds]:

Viscount Astor: moved Amendment No. 6:
	Page 6, leave out lines 6 to 8.

Viscount Astor: Amendment No. 6 prevents any money being moved from the control of one distributor to another even if the purpose of the money is kept the same. The Government have maintained that this is a power only of last resort if a fund persistently does not reduce its balances. They put forward various ideas—either a new distributor would be set up or an existing body with expertise would be used to control some of the money.
	I had a meeting with the Minister to discuss this point. One of the suggestions put forward by his team was that if, for example, the Heritage Lottery Memorial Fund had not satisfactorily brought down its balances, another entity could be used to give the money away. I asked: Who? The answer was, "Perhaps English Heritage". Of course that does not work because you cannot be a distributor and a recipient. That is the difficulty for the Government. In effect, they would have to set up a new body; and that seems to me to be a mistake. They should make existing bodies work. As we have heard, these bodies have to take account of directions given by the Government. The idea of saying to the sport lobby, "I am sorry, the arts one does not work, you can give that", or vice-versa, does not work. It is unnecessary.
	If the Government really feel that any of the distributing bodies are not successful, they should come back to Parliament and say so. The Government have so many powers in the Bill to make the provisions work—by guidance, by direction and by prescription. Subsection (2) of new Section 29A is entirely unnecessary and, indeed, puts the distributing bodies under a threat that they should not be under. No existing bodies will have that expertise and setting up a new body would be worse. It would be much better to make the existing body work.
	Amendment No. 7 ensures that the balances of a distributing body are not reduced to the extent that it is unable to fulfil its commitments to ongoing projects. Often distributing bodies have long-term projects. It is important that they are able to consider that. I know the Minister agrees with that principle. We want to ensure that arbitrary targets are not imposed on the bodies which, in effect, damage some important commitments that they might wish to make and thereby damage the recipients of lottery funding.
	The Government have a duty to ensure that bodies that distribute lottery funds work. They should not have power to be able to swap the money around. They should certainly come back to Parliament through primary legislation if they wish to change the lottery in that fashion. That is the substance of my amendment. I beg to move.

Lord Clement-Jones: I support the amendment in principle. I have tabled an amendment which tries to do something different. The noble Viscount, Lord Astor, has put the case very clearly. We are dealing with the whole principle about moving balances from one fund to another. The view from these Benches is that it should either not exist or it should be at the behest of an independent body. I shall be arguing for a particular form of independent body, but if the Government do not accede to that, then that power should not exist. It is open to abuse, it is not qualified enough and it is a new addition to the 1993 Act. I await the Minister's explanation with interest, but I cannot see any justification for the provision.

Lord Davies of Oldham: I am grateful to the noble Viscount and to the noble Lord for speaking in such reasonable terms about an unreasonable amendment. The thinking behind the amendments reflects unwarranted concern about the Government's intention for the proposed reserve power to reallocate an excessive National Lottery Distribution Fund balance from a lottery distributing body to another body. Amendment No. 6 would completely sabotage the proposed new power, as the noble Viscount, Lord Astor, made clear in his opening speech.
	My ministerial colleagues in another place gave repeated assurances that the power would be used only as a last resort against a distributor who had stubbornly and persistently failed to manage its National Lottery Distribution Fund balance to a reasonable level. Both the National Audit Office and the Public Accounts Committee of another place—both bodies that this House fully respects—have concluded that the public benefit of lottery money is fully delivered only when that money has been spent. The money has no value when it is in the hands of the distributors.
	The distributors have already made great progress in reducing their balances. Any distributor which manages and sets clear targets for balances, as all the main distributors are now doing, will have nothing to fear from the reallocation power. As I said, the power is only a reserve one to be deployed in extreme situations. However, balances have not fallen as far or as fast as we would have wished and progress must continue. We need a reserve power in case any distributor should in future build up an excessive balance and fail to tackle it, because that money is not being used for the purposes for which the lottery is organised.
	Amendment No. 9, to which the noble Viscount also spoke, would build in a specific requirement for the Secretary of State to consider the effect on a distributor's longer-term commitments before exercising the reallocation power. The noble Viscount indicated my assent to his proposition that the Government should recognise that some distributors have longer-term commitments. Of course they have. The Government have repeatedly given assurances that we would not use the proposed new power in a way that would threaten any existing commitment made by any distributor. That is absolutely clear. We fully recognise that many lottery projects are very long-term and that many such projects have already brought great public benefit.
	The trouble with the noble Viscount's amendment, however, is that it would open up scope for wide debate about what constituted a threat to a distributor's long-term commitment. Some might argue, for example, that a distributor needs to hold funds in its balance now to meet a commitment that is likely to fall due for payment in five years' time. The Government would not accept such an argument, since new funds are flowing into the NLDF constantly and any distributor can expect that those funds will continue.
	We therefore believe that it would be reasonable, in the very unlikely event—I emphasise, in the very unlikely event—that we ever proposed using the reallocation power, to take account of a distributor's future income from the lottery, as well as its existing NLDF balance. At the same time, we realise that the level of future income is variable. That goes without saying with the lottery; we have already seen variation in receipts and we can never forecast with absolute accuracy. So in calculating the amount of a distributor's balance to be reallocated, we would leave an adequate margin to take those factors into account.
	I also point out that the National Audit Office, in its report on balance management in July 2004, suggested that distributors should increase their forward commitments as the most effective means of reducing their balances in the longer term. The Government are hardly likely to propose using the reallocation power against a distributor which had followed that advice offered by the National Audit Office by making longer-term commitments.
	I understand the anxieties of noble Lords—opposition is full of anxiety, especially about benign governments—but I emphasise that we look on the powers as reserve powers for when things reach a very difficult, indeed, almost desperate state. No distributor organising its distribution mechanisms effectively and on the lines that we have every right to expect—the public have every right to expect those resources to be made available for the purposes intended—has anything to fear. However, without any reserve power, there might be the danger that a distributor failed to allocate, to reach what are often difficult decisions on distribution, and sat happily on balances.
	In other circumstances, we know that that can provide a feeling of great security, but security is not the issue for lottery fund distributors. The issue is effective use of money of which they are in relatively temporary charge to produce benefits for the community. The Government need a reserve power in that respect. I hope that the noble Viscount will withdraw his amendment, having accepted that eminently reasonable argument.

Viscount Astor: The Minister is full of eminently reasonable arguments about what the Government are and are not going to do. There is only one problem about his eminently reasonable arguments, which is that we all know that commitments given during the passage of the Bill are often ignored when it is enacted. There may be a change of Minister and no one bothers to read what was said or it is totally ignored. We find that what was in one debate a reserve power suddenly turns into a major policy change by another Minister in the same Government. I say that, knowing full well that the Minister could turn round and say: "That happened when the Conservative government were in power". It did. It happens under all governments. That is the nature of the process, I have to say.
	The Minister reassured me to some degree on my second amendment, Amendment No. 9. I understood what he said and I am grateful for his response. However, he did not reassure me at all on Amendment No. 6. Let me take him back a bit. In 1997–98, the balances were touching £4 billion and the Secretary of State at that time called in the lottery operators—quite rightly, in my view—and said that the balances should come down. The Minister, Mr Caborn, said in another place:
	"Just under £4 billion was being held in the balances, and that has been brought down to just a little more than £2 billion".—[Official Report, Commons Standing Committee A; 27/10/05; col. 140.]
	That is £2 billion that has gone out. I know that governments can spend one or two billion pounds pretty quickly when they want to, but lottery distributors find it quite difficult to give away such large sums of money while maintaining the integrity of how they give it away and of the causes and projects that they give it to. They have done a remarkable job in bringing down those balances. There is no indication that they will not carry on doing so. The reserve power is unnecessary. If the Government find that any of the distributing bodies is not bringing down those balances fast enough in future, there are plenty of other ways of enforcing that.
	I am not convinced by the Minister's argument. I shall not divide the Committee at the moment, because I want to listen with care to the arguments on the next group of amendments tabled by the noble Lord, Lord Clement-Jones, which relate to the same issue, but we shall certainly return to the issue at Report. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Clement-Jones: moved Amendment No. 7:
	Page 6, leave out lines 6 to 8 and insert—
	"( ) In exercising its duties under section 33, the Comptroller and Auditor General may make recommendations to the Secretary of State to issue an order subject to affirmative resolution by both Houses of Parliament providing for the money to be held for distribution by a different body specified in section 23 (without altering the purpose for which the money is allocated)."

Lord Clement-Jones: It has been useful to hear the Minister's first shot at a previous amendment; I hope to push him rather further in that respect. We have heard how the balances have gone down. The briefing from the Big Lottery Fund is interesting. Its balances have reduced considerably, but there is a big argument about whether balances should be held and, if so, how much they should be. The national heritage fund clearly has a rather different set of considerations and argues that it should hold higher balances than the other funds to plan for the future and for forward commitments. Nevertheless, progress has clearly been made on the financial management of those balances.
	We are rapidly falling into a pattern in Committee, as we sometimes do, whereby the Minister deploys the full range of ministerial assurances about unreasonable powers which the Government are taking in the Bill. Indeed, he is already doing so. We are already starting to talk about last-resort powers, and saying that these prescription clauses will not be used but will be very broad-brush indeed, and so on. The Minister has already admitted that these are new and strong powers, but his argument is all about how they will be used. This amendment addresses that point exactly, and the voluntary sector in particular strongly desires it. It would ensure that the National Audit Office, rather than the Secretary of State, determined whether lottery funding balances should be moved from one distributor to another or to another body altogether.
	The Explanatory Notes indicate that lottery funds would be reallocated under this clause—indeed, the Minister made exactly the same point—only,
	"as a last resort in the event that a distributor was considered to have failed, signally, to reduce balances to a reasonable level and there were serious concerns about the ability of the distributor to act economically and effectively".
	That is more or less what the Minister said. But in those circumstances, surely the National Audit Office is far better placed to make judgments about effectiveness, economy and financial management by a lottery distributor. It would also rule out the possibility of any such future decision deriving from political motives. The Government might want to enforce their own priorities in those circumstances—priorities that were not properly rooted in the needs of those distributors. The amendment would provide important reassurance for the voluntary and community sector. The Minister said that the issue was the effective use of money, which was why the reserve power was needed. Hear hear! But who will be a better judge of that than the National Audit Office? The National Campaign for the Arts put it rather well:
	"The sanction of reallocating funds from a distributor should be used in cases of serious financial mismanagement. It should emphatically not be tied to any political pressure. As such, the NAO is the appropriate body to instigate the process of reallocation of funds".
	I beg to move.

Viscount Eccles: I have listened carefully to my noble friend Lord Astor, the noble Lord, Lord Clement-Jones, and the Minister. I support the proposition that the Secretary of State takes advice from the National Audit Office; indeed, there could be circumstances in which the auditing accountant would find it difficult to sign off the accounts if he or she felt that political pressure was being brought in a way that put the lottery fund at unreasonable risk. I feel strongly that this is a technical area. I have been the chief executive of the Commonwealth Development Corporation—a body that had commitments. We always had to argue fully to our auditing accountants that we were holding the right balances of cash in order to meet those commitments. Everything that I have read on this subject so far seems to have been overly political and not statements of recommended practice, which is what this balance question needs to follow.

Lord Brooke of Sutton Mandeville: I shall make the briefest of interventions on the emphasis of using the National Audit Office to fulfil the role suggested by the amendments. I remind the Committee of the National Audit Office report in July 2004 on this very subject. It said:
	"significant reductions in balances could take time. There can be considerable time lags between distributors making commitments to pay grants and the grants actually being paid. This is especially the case . . . for large projects".

The Lord Bishop of Southwell and Nottingham: Amendment No. 8 is very simple and I hope that the Minister will consider it sympathetically. Clause 8 empowers the Secretary of State to make an order transferring the balances from one lottery distributor to another. I do not quite follow the logic or the benefits of making such a transfer unless the lottery distributor was supremely incompetent and it was evident that the applicants and the public were being disadvantaged. I hope that the Secretary of State will never have to use this power. The Bill now makes it clear that if the power is used, the balances so transferred must still be allowed for the same purposes. If they are transferred from the Big Lottery Fund, they must still be used for the purposes for which the Big Lottery Fund is set up to fulfil. If they are transferred from the Heritage Lottery Fund, they must still be used for heritage purposes. The relevant sector should not lose the money, so that is a helpful provision.
	The Bill also requires the affirmative procedure of both Houses before a transfer of balances can be made. That is also helpful, as the Secretary of State will not be encouraged to use the power lightly. It also requires the Secretary of State to consult the other lottery distributor to which the balances may be transferred, as well as the relevant authorities in Wales, Scotland and Northern Ireland, before the order is made. But there is no express provision for consultation with the persons most affected or with bodies concerned with the sector as a whole. That is what I seek to achieve through this small amendment. If money was to be transferred, many people would have relevant questions to ask. If, for example, money was being transferred from the Heritage Lottery Fund, what arrangements would there be for the new distributor to take expert advice on heritage matters? What knowledge of the issues would it have? What resources would it have? What would be the effect on applicants whose applications were caught up in the process through no fault of their own? Would it be reasonable to make the transfer at all? Is there a case for doing so?
	Many different bodies—from the National Amenity Societies and English Heritage to representatives of the Churches, including, at national level, the inter-denominational Churches Main Committee, which I chair, and Anglican organisations such as the Council for the Care of Churches, the Cathedrals Fabric Commission for England, and the Church Heritage Forum—would have a legitimate need to be satisfied that the arrangements were going to make things better, not worse. With the thousands of Church buildings up and down the country, so many of which are the physical and social centres of their communities, Church bodies would have a major interest in such proposals, as might many applicants for large sums of money whose applications could be seriously jeopardised or at least very badly delayed by such a transfer, and as might villages, towns and cities where they are located. The views of these bodies should be sought. Exactly the same principles would apply if balances were being transferred from any other distributor, as this clause applies to them all.
	My amendment would therefore require consultation with such persons as the Secretary of State thought appropriate before an order was made. It does not define precisely who those persons would be; that must depend on the circumstances. But it does require the Secretary of State to consider and consult. I note there is already a very similar provision in the Bill to deal with situations in Clauses 7 and 14, which both require the Secretary of State to consult other persons. Both refer to,
	"such other persons (if any) as he thinks appropriate".
	I have not included "if any" in my amendment, as I cannot conceive of circumstances in which consultation would not be appropriate, but because the Bill already accepts this principle of statutory consultation, I sincerely hope the Minister will accept it in Clause 8, too. He may say that it is not necessary to include it in the Bill because consultation will be good practice anyway. I very much hope that consultation will indeed take place, but it would be far preferable and would give more certainty to have this provision enshrined in the Bill.

Lord Davies of Oldham: I am grateful to the right reverend Prelate because he has presented an argument which I need to address, whereas I am having difficulty in thinking up fresh arguments over those I deployed earlier in response to the preceding amendment, although I do have one. But I do not want to appear too unkind to the noble Lord, Lord Clement-Jones, in raising the point. I shall come to it later when I have summoned up enough courage to confront him on it.
	First, on the amendment tabled by the right reverend Prelate, of course we would openly and clearly conduct any process involving the reallocation of a distributor's balance or part of that balance. We would not do it in secret. The process would need to be open in order to maintain confidence in the whole operation of the lottery and the distribution of the resources. Interested parties, including the very important role played by the Church of England in crucial parts of the lottery distribution, would have every opportunity to comment on the proposed use of this power. Ministers were pressed on this point in another place and every assurance was given then. I am pleased to re-emphasise those points today.
	We would expect to publish the reasons for carrying out an act as significant as the use of the reallocation power. As I have indicated all along, this is not meant to be anything except a power to be used only in dire extremis when things have gone wrong to the extent that significant balance reductions are not being effected in line with recommendations made by the National Audit Office itself. Further, any use of the power would be subject to the affirmative resolution procedure and it is certainly the case that all interests would have an opportunity to make their position clear—not least on the part of the Church of England in this House through its representation on the Bishops' Benches. I can give full assurances on consultation.
	I turn to Amendment No. 7. I fall back on the arguments used in response to the previous amendment: we are considering this only against a background of extreme circumstances. Let me describe the present position. The overall lottery distribution fund balance has fallen substantially from a peak of £3.7 billion in 1999 to just over £2.2 billion today. That is a reduction of about 40 per cent. It is good progress, but not as good as we would like. But for all the reasons I have already outlined, I know that all noble Lords recognise that there are reasons why there should be balances. Flows of money from the lottery take place at a certain rate because difficult judgments must be made about effective allocation. A very thorough vetting process is employed before the granting of those resources. However, I can assure noble Lords that the Government would not seek to use the reallocation order-making power in this clause without giving the matter the fullest consideration.
	I employed that argument in response to the last amendment and I use it again now—and I add one for the noble Lord who at times is a little dismissive of my answers. I speak having given full consideration not only to the issues in the Bill but to his judiciously placed amendments. However, this is one of his least judicious amendments. Here he confuses a very important constitutional position. By involving the Comptroller and Auditor-General in the work of the Executive—because that is what he would be doing if the C&AG were involved in this process—he would involve an individual with the powers of the C&AG in decisions that are properly matters for the executive. That would undermine the strength of the comptroller's role. He and his office are held in such high repute because of their total independence from government. We could not possibly have a situation where the role of audit and evaluation on behalf of the public of actions taken by the Executive in their spending decisions were compromised because the comptroller himself had become a part of the decision-making process. I hope, therefore, that the noble Lord will rethink this part of his amendment.
	I do not suggest to the noble Lord that he should abandon his amendment in its entirety at this early stage. He would come back to the issue on Report and, if I were in a lot of trouble, at Third Reading as well. But I hope that the noble Lord will think again on this issue because here he offends one of the constitutional principles by which we all abide, and I am not prepared for him to fall again into such a pit of error. If he does so again, he will find that I am equally robust in rejecting his amendments. However, I am sure that he will withdraw his amendment today and that if he does bring it back, it will be in a better form.

Lord Clement-Jones: I thank the Minister for that response. The right reverend Prelate made some extremely good points in regard to his amendment. Indeed, I thought that the Minister—in contrast to my own amendment—rather conceded the case. If I may be so bold, the right reverend Prelate should be encouraged to bring his amendment back at the next stage. The Minister did not have an argument against it at all. Like the other clauses quoted by the right reverend Prelate, clearly it would make sense to include an additional requirement for consultation here, as is the case in so many other clauses.
	I waited with trepidation after the Minister trailed the howitzer of an argument that he was going to use, but I am afraid that when it finally appeared it was more of a mouse than anything else. I must say that it is precisely because the NAO is independent that it is included in this amendment. According to those in the many organisations who have urged me to move the amendment, it is precisely because of the constitutional position of the NAO that they wish to see it at least as the body advising on the situation in those circumstances. Because there is worry about the Government's motives and interests in those circumstances, they wish to see the NAO operate as an independent body. Aside from that point, the Minister has himself admitted that he has no fresh arguments. So once he has conceded—and I hope he will—that it is precisely because of the independence of the NAO that it appears in the amendment and that there ought to be a reserve power in those circumstances, I cannot see that he has an argument against the NAO. So I look forward to the next stage of the Bill when I expect a different and more favourable response from the Minister. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Lord Bishop of Southwell and Nottingham: had given notice of his intention to move Amendment No. 8:
	Page 6, line 14, at end insert—
	"( ) such other persons as he thinks appropriate"

The Lord Bishop of Southwell and Nottingham: I rise only to say that I am grateful to the Minister for his commitment to conduct openly and clearly any renegotiation, should these cases ever arise. I am also grateful to the noble Lord, Lord Clement-Jones, for his encouragement. At this stage I am happy not to press the amendment tabled in my name, but given the welcome it has received this evening, I am encouraged to bring it back.

[Amendment No. 8 not moved.]
	[Amendment No. 9 not moved.]
	Clause 8 agreed to.
	Clause 9 [Investment income]:
	On Question, Whether Clause 9 shall stand part of the Bill?

The Lord Bishop of Southwell and Nottingham: I rise to oppose the Question whether Clause 9 stand part of the Bill. As I made clear on Second Reading, the provisions in this clause cause me considerable concern on behalf of those who look after historic buildings, particularly our historic churches and cathedrals.
	The intention behind the provision is one of strict logic. Lottery distributors are given a specific proportion of proceeds from lottery tickets and any interests they accrue on the balances they hold shall be allocated in the same proportion. No lottery distributor can gain extra, as it were, by holding on to its balances in order to get more interest than the others. All distributors are treated equally. This may be a logical approach but it has significant consequences. That is why I and others in the heritage world are concerned.
	The body most affected by this will be the Heritage Lottery Fund. Simply because of the great wealth of the historic environment, HLF will have a significant task on its hands. As I have said in earlier debates and at Second Reading, 45 per cent of the Grade I listed buildings in the country are Church of England churches and the repair needs alone of churches and cathedrals are very considerable. A survey of the 16,000 parishes in 2003 and the quinquennial report showed that £373 million—or probably more—was needed for repairs. This takes no account of significant projects that churches may wish to carry out in the interests of the wider community.
	Major projects on buildings—be they repairs or new works—take time and money. Once applicants have been offered a grant, they need to finalise the funding package, make sure they have the necessary consents, draw up specifications, go to tender and instruct builders. Even when they start work, HLF will not pay all the money immediately; it will want to see that progress is satisfactory. HLF, meanwhile, must make sure that it has the money it has committed. It cannot allocate it elsewhere. It can only depend, to a certain extent, on money coming from further lottery tickets. So it must keep some money in the bank. This is not a perverse incentive to hold on to balances to gain interest; it is simply being prudent to ensure that the money is there when needed.
	Clause 9 will therefore reduce the total available to them. Interestingly—I do not know whether the Government have thought this through—it will also mean that HLF is subsidising other lottery distributors. Perhaps I may illustrate this point using figures that are easy to grasp. Let us say that the total interest accrued by all lottery distributors to their balances is £100 million. Let us also say that the proportion of that accumulated by balances held by HLF is £30 million. At present, HLF keeps it and it can be used to augment its existing income. Under Clause 9, it would keep only £16.5 million—16.5 per cent—just as it receives 16.5 per cent of lottery proceeds in the first place. This means that HLF would lose £13.5 million—at least in the simple example I have given—and that £13.5 million would be shared among the other lottery distributors. They gain extra funds—which is very nice for them—as a result of the needs of the heritage sector to hold money for major capital works. I question whether that is right.
	The Government have recently consulted on the future of the lottery and what the priorities should be after 2009. The question of the moneys available to heritage, both from taxpayers' money and lottery funding, needs to be addressed seriously. Heritage and our churches need more money, not less. The same message is coming in consistently from the General Synod of the Church of England and from English Heritage and the Inspired! campaign that they are shortly to launch. Repair grants for churches are no higher now in real terms than they were in 1994 and have kept their level only because of the contribution of HLF itself. In the same period, building costs have risen by 70 per cent. Churches matter to the people of this country, be they worshippers or not. They contribute considerably to the social capital of the community and yet they are largely dependent on volunteers and need more help.
	If the Minister is adamant on retaining the clause, I hope he will be able to reassure the Committee that heritage will receive a significantly greater proportion of the total lottery funds after 2009 in compensation, to enable us, as a country, to look after our inheritance and to enable us and others to enjoy and appreciate it as it deserves.

Lord Brooke of Sutton Mandeville: I support the right reverend Prelate the Bishop of Southwell and Nottingham. It would be quite helpful if the Minister, as a Whip, could give some guidance on procedure in his reply. Are those who wish to raise questions on a clause stand part Motion obliged to put their name on the Order Paper, or can they rely on someone else having indicated that there was likely to be a debate? It will be helpful to know whether in fact we should put our names down. I noticed a slight hesitancy around the Table when the right reverend Prelate rose to speak.
	The point I wish to make in support of the right reverend Prelate is exactly the same as the one I made on Second Reading—namely, that large projects require more management than the distribution of small grants. Of course the building of cathedrals is unlikely to be a subject which will come under the Heritage Lottery Fund, but it will serve as an example. If Durham Cathedral took 40 years to build—a remarkable achievement in itself in the era in which it was built—the cathedral in Prague took 1,000 years. When one tries to calculate how much management went into the building in Prague over those 1,000 years, one winces. A distributor which leaves money in its balances, and thus earns interest on it, may be doing so in part to compensate for the fact that, because of the nature of the projects, the distribution of the resources takes longer and therefore costs more.

Viscount Astor: I did not leap to my feet when the Question of whether Clause 9 should stand part of the Bill was brought to the attention of the Committee, although I have put my name to it. I apologise to my noble friend Lord Brooke if that has caused some confusion. It is, of course, open to any noble Lord to speak to any clause even if they have not put their name forward to oppose it. This is done to help the Minister, who then knows that he might have to reply. I am extremely grateful to the right reverend Prelate—it was remiss of me not to instantly rise to my feet—because he has raised an extremely important issue. In my slightly muddled state, I thought that we had covered most of the issues on the previous two amendments. But, of course, we had not, and I am particularly grateful to the right reverend Prelate for raising the matter.
	Our concerns about Clauses 8 and 9 are connected. I shall, of course, listen carefully to the Minister's arguments but I think we will have to come back to both clauses and press the Government further. We have to get our amendments right. Clearly there is a problem here on which the Government have not sufficiently satisfied us. I am sure that the right reverend Prelate, the noble Lord, Lord Clement-Jones, and I will return to this matter at the next stage. But, of course, we shall listen with great care to the Minister now because he may or may not convince us.

Lord Davies of Oldham: I can assure the Committee that I am always prepared for stand part debates. As has been indicated, it is the privilege of noble Lords to speak in clause stand part debates whenever they choose. We are grateful when it is indicated beforehand because it enables us to polish up and refine our arguments even more than usual. So if this reply is a little rusty and a little crude, it is because I was not quite certain that the clause stand part Question would be debated on the basis of the right reverend Prelate's arguments, which I fully respect.
	I can reassure the right reverend Prelate that the proposed new arrangements in the clause are designed to make matters fairer and more transparent for all and not to penalise particular good causes or distributors. The question of the position of churches was aired substantially in the other place, not least, of course, because the distributor is the one which is likely to have the longest time lag between distribution and effect. When we were discussing earlier amendments in this area we gave due recognition to the fact that long-term commitments would have to be entered into which would need to be respected. I want to reiterate the reassurances that I hoped I had given on that amendment.
	We cannot tell how quickly the present balances will be reduced. I indicated that they had been reduced by 40 per cent since 1999. That progress is not as fast as we would wish. We reiterate that, as the National Audit Office and the Public Accounts Committee attest, unnecessary large balances are not of benefit to the nation. Those who benefit from them are few and far between. Some distributors might feel slightly reassured by the fact that they can meet any possible demand made on them, but they also know that the National Audit Office does not think much of it, that the Public Accounts Committee is critical, and that the Government want them to come down, as they want to see the money used intelligently. The pressure is there.
	The anxieties articulated by the right reverend Prelate must also be taken into account. The Heritage Lottery Fund must not be put in a position in which it cannot support its many worthy projects, of which churches are a significant part because of their significance both in architectural terms and for local communities. With balances continuing to fall, in line with government policy, the new arrangements, by the time that they are likely to take effect, will have no major impact on any particular good cause or distributor. We are talking about substantial balances being run down; we are not talking about a dramatic occurrence with an adverse effect on anybody. No distributor is quaking under the pressure being exerted to get balances down. Nor would any recipient have cause for alarm about a concern to ensure that the distributor is distributing rather than holding on to resources that could usefully be deployed in the community. I give that reassurance to the right reverend Prelate.
	I am grateful for this short debate. I hope that I have clarified the significance of Clause 9. The clause produces a formula for a position of last resort which encourages progress on reducing these balances and putting them to good use for the community. I hope that the right reverend Prelate will feel reassured enough to agree to the clause remaining in the Bill.

Viscount Eccles: Does the Minister agree that if one were managing a lottery fund, the best way to get one's balances down would be to increase the number of grants made, lower the average value of the grants and make the period for which one gave the grant shorter? That is probably the most powerful way of doing what the Government have been looking for. Does the Minister have any statistics that would show whether that has been happening?

Lord Brooke of Sutton Mandeville: Before the right reverend Prelate responds, let me say that I yield to no one in this House in my admiration for the Minister in charge of this Bill and the soothing way in which he handles it. He has a superb bedside manner. In the context of what he just said, however, I thought that he was being over-soothing. If it is true that the National Audit Office has calculated that the clause as it now stands would have reduced the Heritage Lottery Fund's income by £15.7 million in 2003–04, that figure exceeds the total amount that English Heritage gives to the churches in a given year. That is not small change. If that is the effect of the clause, the Minister is being somewhat over-sanguine about what the consequences will be.

The Lord Bishop of Southwell and Nottingham: I apologise if I wrong-footed the Minister in any way or caused procedural confusion in the Commiittee. I thought that that was a glorious example of the House regulating itself. I am grateful for what the Minister said, which I and others will note. I am happy not to oppose the clause further.

Clause 9 agreed to.
	Clause 10 [Distributing bodies: consultation]:

Lord Clement-Jones: moved Amendment No. 10:
	Page 6, line 31, leave out from "body" to "person" in line 32 and insert "—
	(za) must consult—
	(i) the Secretary of State,
	(ii) bodies (other than public or local authorities) whose activities are carried out not for profit,
	(iii) the National Assembly for Wales in relation to Welsh devolved expenditure,
	(iv) the Scottish Ministers in relation to Scottish devolved expenditure, and
	(v) the Northern Ireland Department of Culture, Arts and Leisure in relation to Northern Ireland devolved expenditure;
	(a) may consult any other"

Lord Clement-Jones: We broadly support Clause 10, which allows lottery distributors to take account of public opinion in determining funding programmes and priorities. However, we believe that this must not be in lieu of full and proper consultation with relevant stakeholders, including the voluntary and community sector.
	The declared aim of the Big Lottery Fund is to bring improvements to communities and to the lives of people most in need. It is difficult to envisage how this will be achieved without the voluntary and community sector. If lottery funding is to have the maximum impact on communities, programmes should be designed in consultation with voluntary and community organisations. Greater public involvement in the lottery must be preceded by, or coupled with, attempts to increase public understanding of the true destination of lottery funding. The majority of respondents to an ICM poll commissioned by NCVO in 2004 believed that organisations supporting asylum seekers received the same level of lottery funding as organisations supporting the disabled. That is a typical example. In reality, asylum seekers' organisations received 2.5 per cent of Community Fund money while the disabled organisations received 22 per cent.
	Therefore, there is quite a lot of room for greater public understanding, and it is essential that a balance is struck between public involvement and full and proper consultation in the distribution of money. This should help to control a situation in which simple beauty contests could dictate the distribution of funds or lottery funds might be diverted away from their original targets—those causes worthy of money above and beyond the remit of government spending. I beg to move.

Lord Davies of Oldham: I am grateful to the noble Lord for the way in which he moved the amendment. I think I know where he is coming from, and I greatly applaud the objectives of his amendment, although I will ask him to withdraw it.
	As I see it, the noble Lord's argument is that distributors should take a suitably strategic approach before putting a major lottery award to a public vote or consulting relevant experts. I imagine that he is worried that the less popular causes might miss out, because of a great number of misconceptions about where lottery money goes, of which he gave an excellent illustration. I recognise that consideration. We are aware of the importance of worthwhile causes which, for whatever reason, do not have mass support but merit consideration.
	Let me emphasise first that we have no intention of putting more than a small proportion of distribution decisions to public votes. In each case, distributors will take great care in making the necessary preparations. The power is not compulsory for distributors but permissive and enabling. It makes clear that distributors have the power to take account of public views when making distribution decisions if they wish to do so, and where they think that it is appropriate. That will include consultation with appropriate bodies, sometimes in the voluntary and community sector and sometimes the devolved administrations, as mentioned in the amendment. In other cases, other bodies entirely will be consulted; it will depend on the subject of the grant.
	I understand the noble Lord's anxiety and I am glad he has aired it this afternoon. But the problem with the amendment is that it would require each distributor to carry out a consultation process with the Secretary of State, the voluntary and community sector and the devolved administrations for every award of grant, regardless of whether it was relevant to them and regardless of whether the award involved public consultation. That is a pretty considerable burden to place on the distributors, and a costly one too. It would also make lottery distributors dependent on the Government because, before the grants were made, there would have to be consultation with government. A significant principle is that the distributors make decisions independent of government. The amendment would also increase the time taken to award grants, yet, with very significant balances, we have been discussing the necessity of streamlining the process of allocating new grants so that the money can be used intelligently and quickly.
	The measures in the Bill are designed to help lottery money go more quickly and efficiently to good cause projects and to reduce unspent balances. The distributors already consult widely, and we already have policy directions to set the overall framework. That seems to be the necessary basis on which this structure can work. I fear that the amendment goes too far. It would compromise certain important principles and slow the whole process down when the Government are getting general public support for trying to make the process more efficient, distributing funds more effectively and quickly and reducing the unspent balances. That is why I hope that the noble Lord will recognise that despite this good cause, the amendment is not the appropriate way in which to amend the Bill.

Viscount Astor: Before the noble Lord, Lord Clement-Jones, decides what to do with his amendment, I should like to ask the Minister a question. He talked about distributing bodies having a public consultation about part of their funding. What happens if the consultation comes back and the spending proposed would in effect be additional? What happens when the public say that they would like more policemen in their area? An interesting aspect of the amendment is the reference to devolved expenditure; it contains a protection for additionality. Will there be protection for the principle of additionality in the consultation process?

Lord Davies of Oldham: As ever, it depends on the question which is asked. The distributors will not be asked, "What is your most desirable No. 1 good, and how can we give you access to the appropriate resources to achieve that?" We might get a plethora of answers or some that we would find it difficult to square with general public policy. After all, the noble Lord, Lord Clement-Jones, indicated in his illustration the idiosyncrasies of public response on some matters. But there is a list of options, appropriate and specific, for awarding a grant. If such a list were put before the public, they could reach a wholly intelligent, acceptable and meritorious solution to a problem which would otherwise rack the brains of the distributors. The distributors have already engaged in public consultation, to good effect. I cannot see how that could be gainsaid by anyone. But the noble Viscount is indicating an open-ended question where the public would be asked to fill in the blank. That is not consultation as we understand it within the framework of the Bill.

Lord Clement-Jones: I thank the Minister for his reply. This has been a short but very useful debate. How this operates could be crucial in the way in which the distributors allocate their funds. There is an aim on all sides, reflected by the Minister in his assurances and by the Big Lottery Fund briefing, which I found very useful, to avoid gimmicks. We do not want a "bread and circuses" approach to BLF funding, let alone any other distributor. There is no difference between us: the issue is whether the wording of the clause will allow that approach to be adopted in certain circumstances. As the noble Viscount, Lord Astor, pointed out, governments change—even within governments there are changes of policy. Something may appear particularly attractive, and going down the opinion poll route might look politically attractive in certain circumstances.
	I shall read very carefully what the Minister said. He seemed to be giving as much assurance as he could in the circumstances. The question is whether I can push him any further and whether qualifications can be made that stack up. I accept that "must" may not be the most helpful of words in that context. However, I believe there is room for qualification as the clause is too open-ended. I may come back to this issue on Report but in the mean time I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Clause 10 agreed to.
	Clause 11 [Distributing bodies: publicity]:

Lord Clement-Jones: moved Amendment No. 11:
	Page 6, line 38, leave out "may" and insert "shall"

Lord Clement-Jones: In moving Amendment No. 11, I should like to speak to Amendment No. 12 as well. These are probing amendments, designed to look at the width and intentions of the clause. The Minister, being his usual astute self, will have noticed that they stretch the clause in different directions.
	The first amendment is designed to tease out where the Government are coming from in terms of requirements on the distributors to publicise their activities. The lottery operator has a sense of frustration about how the fact that these projects are funded by the National Lottery does not always come through. Some progress has been made in developing a good causes common brand via the National Lottery Promotions Unit—blue crossed fingers, blue plaques, and so on. The power now resides in the Bill but what sort of injunction will be placed on the distributors? There is sometimes negative coverage of the National Lottery as a concept, but very rarely is that counteracted by good publicity for the fact that good projects are funded. The transformation of our museums in London has been due to National Lottery funding, but I wonder whether that really comes through.
	The second amendment to Clause 11 reflects a number of different concerns. Could the wording of the clause place, if not an obligation, certainly a moral imperative, on the distributors to publicise the lottery itself? Many voluntary organisations and some distributors feel extremely nervous and, indeed, negative about this issue. Why should there be a duty to promote the National Lottery? They should publicise the projects but not participation.
	There are many other ways in which voluntary organisations will want to promote charitable giving. They do not want to be driven down a narrow channel of saying, "Really, folks, you should be publicising participation in the National Lottery as the way of contributing to our charitable cause".
	I will be interested to hear a lot more from the Minister about the thinking and motives behind the clause. What publicity would the Government like to see? What kind of publicity do they think is appropriate? Would it be purely of projects, or will distributors really be asked to encourage participation in the National Lottery? I beg to move.

Lord Pendry: I am glad to support Amendment No. 11 and to have an opportunity to contribute to this debate on this important Bill. I have said previously in this House that I tend to worry that I support the noble Lord, Lord Clement-Jones, on too many occasions. I have done so twice in some 10 days and three times in three weeks. The Committee must not read too much into this; it is just that, now and again, he can be right.
	I have been a foremost supporter of the National Lottery since I was asked by the late John Smith to lead for the then opposition on the original Bill in 1993 in another place. Voting for that Bill at Third Reading and convincing some of my colleagues to do likewise was not an easy task. I am sure that the noble Lord, Lord Brooke, will remember the difficulty that I had. Many reservations were expressed by members of my party, understandably so by those who represented Liverpool constituencies and who were concerned about jobs in the football pools industry. However, our Front Bench were able eventually to assure many of the dissidents of the overriding importance of introducing a national lottery which would benefit many good causes and create many jobs in the process.
	I have witnessed at first hand the importance of the lottery through my roles as chairman of the Football Trust and as chairman, and now president, of the Football Foundation, which has supported projects worth more than £365 million since it was launched in 2000. It has £63 million worth of projects in the pipeline. I therefore support Amendment No. 11, which would place an important duty on those responsible for distributing lottery money to attribute and promote the National Lottery as the source of this funding. This is an important commitment, which will have a hugely beneficial impact on improving public confidence in, and understanding of, the lottery.
	Camelot deserves due recognition for its role in operating the lottery. The National Lottery is experiencing its longest-ever period of growth, which means more for good causes. Lottery sales remain the foundation for maximising returns to good causes. Impressive results led to an increase of nearly £60 million in returns to good causes in the year to 31 March 2005. That is an increase of 4.6 per cent.
	Our lottery is in good health—that is for sure—but we should not be complacent about the fundamental role that public confidence in, and support for, the lottery plays in maintaining its success and the money that is consequently available for good causes. Too often, we see in the newspapers yet more criticism of how lottery money is spent and an outcry about the suitability of certain projects to receive lottery funding. When do we see enough coverage of the many good stories that result from National Lottery money?
	Strengthening the wording of the Bill to ensure that distributors properly accredit the National Lottery for the numerous projects that it funds would help to counter this mood and increase public understanding of the lottery's benefit to society as a whole. Promotion of the lottery is a task for the operator, but distributors should be energetic in demonstrating the good that its money has done.
	I understand that some progress has been made, as was mentioned earlier, in introducing the blue plaques and a National Lottery good cause common brand. Such plaques are virtual or real and are adorned with the well known crossed-fingers logo. They identify where lottery funding has been used to raise public awareness. I commend this work, but would like to see it extended to have the strongest impact on the public. Placing a blue plaque on every project which receives funding; making formal recognition of lottery funding a condition of each lottery grant; and requiring distributors to report annually on how they are promoting the lottery brand would increase the public stature of the lottery. Those activities could be pursued under the terms of the amendment. I hope that the Minister will explain the progress being made on this.
	As the lottery matures and faces increasing competition from the gambling sector, this kind of acknowledgement is vital to keep public interest and confidence high. As chair of the parliamentary All-Party Group on Sport and president of the Football Foundation, I have argued this point for some time. I fully understand the importance of lottery funding to the health of sport in the UK. Moreover, we should not forget the vital contribution that lottery money will make to our ability to host a fantastic Olympic Games in 2012.
	I urge the Minister to support the amendment as an effective way of maintaining and building public confidence in the lottery and the good causes that it funds, and to do so in the interests of all those who believe in the lottery. The Government should make a commitment to ensuring that the amendment is carried.

Lord Brooke of Sutton Mandeville: The noble Lord, Lord Pendry, has no cause to be anxious about the number of times he supports the noble Lord, Lord Clement-Jones. If he counts the number of times that he opposed me in 1993, he will find that he has a considerable credit balance against which this modest debit balance can be calculated.
	The noble Lord referred to the original National Lottery Bill. Down the years—it is now 13—I thank him for the manner in which he persuaded the opposition Front Bench to support the Bill at Third Reading. I know the difficulties that he had. That there was no controversy between the two Front Benches when that Bill was enacted made a great deal of difference to the future of the lottery.
	I support the spirit, if not exactly the letter, of the amendment moved by the noble Lord, Lord Clement-Jones. In the debate on volunteering last Thursday, I gave a trailer of Clause 11, because of the importance of making sure that sufficient knowledge exists about those lottery achievements which are positive and popular to offset the periodic unpopularity of certain decisions. The figures which the noble Lord, Lord Clement-Jones, quoted about the amounts spent on disabled people and those associated with immigration made the point vividly. If the NCO figure is right, in terms of the degree of public ignorance regarding the amount being spent on really good causes, you could get a distorted view if an unpopular cause arose.
	The point that I made on Thursday was that the degree of prescription and direction, which we have already debated, increases to some extent the possibility that critics of the Government will use an unpopular decision to beat the Government, as well as the particular lottery distributor, over the head. So the more knowledge there is in the public domain, the better. Although I do not necessarily support the precise letter of the amendment, I hope that the Government can encourage us that the more information disseminated about the lottery's achievements at serial level—not just in large global figures—the better.

Viscount Astor: I support Amendment No. 11, moved by the noble Lord, Lord Clement-Jones. The Minister will no doubt say that inserting "shall" rather than "may" would be too prescriptive. Of course, the Government like prescription when they want to prescribe, but not when someone else wants to prescribe. I echo all the points made by my noble friend Lord Brooke and the noble Lord, Lord Pendry.
	Both those noble Lords will remember the concerns, when the original lottery Bill came before both Houses of Parliament, about charitable giving and giving to good causes. I am particularly concerned by Clause 11, and paragraph (c) of new Section 25E, to which Amendment No. 12 relates. The provisions muddle up charitable giving and the lottery, which was always a concern. Let us remember that the public buy lottery tickets not to give money to good causes but to win a prize. We have always maintained, and those involved in the lottery have always made sure, that the most effective way to give money to charity is to give it directly to a charity. So I am very concerned when I see the words,
	"encouraging participation in activities relating to the National Lottery in general".
	That seems to blur an important principle.
	If we could have some words referring to National Lottery distributors, or something like that, I should be entirely happy. As my noble friend said, the more publicity that goes to the worthwhile awards that are made, the better—and we all know how important good publicity is. There is no doubt that good publicity encourages people to buy tickets and encourages more money to flow through the system, but we should not confuse with charitable giving the job that Camelot does in publicising so that people buy tickets for the National Lottery. We all accept that that has a motivation different from charitable giving. Camelot's job is to encourage the purchase of tickets, and it does that well. But I am concerned that the distributing bodies referred to will be muddled in how they promote and publicise things. It is extremely important that we get them to publicise these things, but I should like more focus so that there is no confusion and the distributing bodies promote what they have done, rather than having the somewhat generic reference to the National Lottery in paragraph (c).
	Will the Minister consider those concerns and whether there is some different wording that would satisfy my concerns and the aspirations, which I entirely support, of the noble Lord, Lord Clement-Jones?

Lord Phillips of Sudbury: I am a little perplexed by paragraph (c) of new Section 25E, on which the noble Viscount has just concentrated, because it gives power to any of the distributing bodies to encourage,
	"participation in activities relating to the National Lottery in general".
	Why is it not proper for the national charities distributing body to encourage participation in activities relating to that distributing body, rather than "the National Lottery in general"? I can see why, if you were going to include an encouragement provision, you would want encouragement to be possible of the lottery as a whole; but it seems more natural for a distributing body to concentrate on the issues that are germane to it in seeking to encourage engagement. Is there an intention to exclude that possibility by referring only to the "National Lottery in general"? That would seem perverse.

Lord Davies of Oldham: I am grateful to all noble Lords who have spoken in the debate, but if my noble friend Lord Pendry wanted to correct the impression that he was giving wholehearted support too often to the noble Lord, Lord Clement-Jones, he could have agreed with Amendment No. 11—which would still have upset me a little, as I am going to explain why I want it withdrawn—but then condemned the noble Lord's Amendment No. 12, which runs somewhat contrary to Amendment No. 11. Then he and I would have been in agreement—and it is always helpful if the Front Benches and Back Benches see eye to eye in these circumstances.
	The noble Lord, Lord Brooke, said that he agreed with the spirit but not the letter of the amendment. Of course, the Government agree with the spirit; it is the letter—or three letters—which upset us, in that the amendment would remove the three letters of the word "may". I shall have the noble Lord, Lord Brooke, on my side with regard to that when I identify the problem. Of course, we accept the spirit behind the amendment, but we do not think that it should be a duty; it should be a power. People have the right to know where lottery money is spent, so I accept entirely the spirit of the amendment, and I am with the noble Lord, Lord Brooke, on that. I can also see why the noble Lord, Lord Clement-Jones, seeks to extend the concept.
	The noble Lord wishes to ensure that the distributing bodies play a full part in acknowledging where lottery funding has gone, and that in doing so, they let the public know what projects in their area have received lottery funding and which programmes that the distributors operate are funded with lottery money. My noble friend Lord Pendry said why he thought that was also of advantage to the community. As a government, we want to achieve the same ends, but there is a crucial difference. We feel that there is no difference in practice between what we are trying to achieve through a power and what the noble Lord seeks to achieve as a duty.
	We expect the distributing bodies and the beneficiaries of lottery grants to use the National Lottery common brand, which is based on the crossed-fingers logo, to show people how lottery money is being used and which local projects and programmes have benefited from lottery funding. The logo is one of the most recognised brands in this country; it achieves 94 per cent recognition rate, which is very high. I know that my noble friend Lord Pendry would be satisfied only with 100 per cent—but he will recognise that brands established long before the National Lottery cannot achieve 100 per cent. So 94 per cent recognition of the symbol is a pretty good rate, and we expect that it is used frequently.
	The majority of lottery distributors are already enforcing the use of the common brand by making it a condition of grant for beneficiaries to acknowledge the lottery grants they receive in this way. They also offer comprehensive guidance to grant beneficiaries, which shows them how to use the common brand effectively and to the best advantage to show people that their funding has come from the National Lottery. But we do not need to replace the power that we are giving the distributing bodies to publicise their grants. With a power we can achieve the same ends, and are gradually doing so, while a duty would open up areas of great complexity. We know that the main concern is to have wide display of the lottery common brand.
	Could we or the noble Lord, Lord Clement-Jones, draw up effective arrangements that would encompass the detail required to meet every branding scenario; for example, the form of materials that should be used and how they should be used? What about the penalties for not complying with this? Any arrangement would have to have a method of enforcement if it were a duty. And it would have to reflect the multiplicity of branding scenarios; we all know that lottery money is spent on a very wide range of projects. In some cases it might prove impossible and impractical to realise this branding concept. What about branding a church with the Lotto brand, or a hospital scanner? What would we do about the Angel of the North—should we put a brand on a sculpture to show that it was lottery-funded? What about a piece of music that has been composed as a result of a lottery grant? Where is the logo going to be? The noble Lord, Lord Clement-Jones, is saying not that there should be power to do this where you can, or that we should be reasonable and encourage people to demonstrate their support for the lottery, but that it should be a duty to do so.
	Amendment No. 12 runs somewhat contrary to that, and seeks to prevent lottery distributors encouraging participation in activities involving the lottery in general. I understand why this amendment has been tabled. The noble Viscount, Lord Astor, also articulated some important arguments on this. Concern has been expressed by the voluntary and community sector that Clause 11 would allow promotion of lottery games and might imply that playing the lottery was an alternative to giving money to charities. As we said in another place, we have no such intention of setting up the lottery as an alternative and a rival to charity.
	The characteristic intervention from the noble Lord, Lord Phillips, which I always look forward to with the greatest enthusiasm, has produced a series of questions I cannot answer from the Dispatch Box. I am going to compose a very long and involved letter in reply, which will have to suffice with regard to the details he has brought forward this evening. He will forgive me for that.
	We have made clear many times that distributors will not be in the business of promoting the National Lottery games. As the noble Viscount, Lord Astor, said, that is Camelot's role, a task it does very well. We know that people who play the lottery are pleased that some 28 per cent of the money they have handed over goes to good causes, so they appreciate that there is a connection between money spent playing the game and money going to good causes. But it is important to ensure that distributors have the power to see that link when they publicise where lottery players' money has been spent.
	Clause 11 will ensure that all lottery distributors can take part fully in the activities of the National Lottery Promotions Unit, which seeks to raise positive awareness of, and support for, the benefits of National Lottery good cause funding across the country. The promotion unit already drives a lot of well regarded work. We believe it is important that distributors should have the power to become fully engaged in the activities the unit organises; not promoting the games, but ensuring that people can see where the lottery good cause money has been spent, a distinction we are seeking to emphasise. We share the anxieties about promotion of the games as a competitor to charities, but we think it is right that people should be able to see the connection between the lottery and good cause money that has been spent.
	It seems a little odd that the noble Lord should be making a requirement that lottery distributors participate in arrangements for publicising lottery good cause funding while seeking to prevent those same distributors having the clear power to take part, and encourage participation, in activities relating to the lottery, such as a National Lottery day. It must be right that distributors can play their full part in that. That is different from setting the lottery up as an alternative to charities and contribution thereto.
	This has been a useful debate. There is a tension between the two amendments. I hope noble Lords will recognise, as the noble Lord, Lord Brooke, enjoined us to, that the Government share in the spirit of Amendment No. 11. We think we can achieve the aims of the amendment without changing the nature of the Bill, and that is our intention. On Amendment No. 12, we think we have drawn the line between effective publicising of the lottery and setting it up as a rival to charitable giving, a fear the noble Viscount expressed when he moved his amendment.

Viscount Astor: Before the noble Lord, Lord Clement-Jones, replies, I would like to press the Minister on one issue. Paragraph (c) in Clause 11 talks about,
	"encouraging participation relating to the activities relating to the National Lottery in general".
	It is the words "in general" that give us some concern. Following what the Minister said about the promotional board, perhaps he would allay our fears by considering a better wording for that clause that made it absolutely clear to the distributing bodies that they were promoting that part of the National Lottery, and not the part that relates to Camelot. Perhaps some redrafting could be considered.

Lord Davies of Oldham: The benefit of the Committee stage is that we are able to look at noble Lords' contributions to debates and reflect on them. I will certainly reflect on the point that the noble Viscount has raised.

Lord Clement-Jones: I thank the Minister for setting out in some detail the Government's approach to the clause. We should remind ourselves that this is not simply about amending an existing power; it is a wholly new clause, which will be Section 25E in the 1993 Act. I was grateful to a number of noble Lords who have a considerable amount of experience in this area whether as Ministers or distributors.
	The more the debate went on, the more I thought the two amendments are highly compatible. Noble Lords were in favour of vigorous publicising of projects funded by the National Lottery, but they did not expect distributors to publicise participation in the National Lottery itself. That is an important distinction to make. The more the Minister spoke, the less sure I was about paragraph (c) in particular. The noble Viscount, Lord Astor, and my noble friend Lord Phillips made some telling points. This issue is where some of the concerns lie.
	As regards the may/shall argument, I largely accept the Minister's point. The essence of the amendment is to ensure that the distributors are vigorous and participate in the good causes common brand. I very much hope that that will continue and that they take up the challenge to ensure that projects publicise the source of their funding and so on. For that reason, it is helpful to hear from noble Lords who have ministerial experience.
	I do not believe, however, that the Minister has really answered the questions about paragraph (c):
	"encouraging participation in activities relating to the National Lottery in general".
	That is a very broad phrase. The Minister talked about National Lottery day. What exactly is National Lottery day if it is not a way of encouraging participation in the lottery? It is not purely about the projects and their funding. It seems to me that paragraphs (a) and (b) cover that entirely satisfactorily. Why have we got paragraph (c)?
	Returning to the broad principles, I think that we are groping towards agreement on wanting these projects and wanting some of the negative publicity about the National Lottery to be dispelled by pointing out the benefits of lottery funding, but there is a sting in the tail in the clause which I do not believe that the Minister has adequately answered. We shall give serious consideration to returning to paragraph (c) on Report. But in the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendment No. 12 not moved.]
	Clause 11 agreed to.

Viscount Astor: moved Amendment No. 13:
	After Clause 11, insert the following new clause—
	"ADDITIONALITY
	After section 25E of the National Lottery etc. Act 1993 (c. 39) (as inserted by section 11 of this Act) insert—
	"25F THE ADDITIONALITY PRINCIPLE
	(1) A body which distributes money under section 25(1) shall have regard to the principle that funding under that section should not be provided for the provision of services, benefits and capital works which would usually be provided by core government spending when—
	(a) determining the persons to whom, the purposes for which and the conditions subject to which the body distributes any money under section 25(1);
	(b) preparing, adopting, reviewing, modifying or replacing a strategic plan under section 25C or 25D.
	(2) The Secretary of State shall have regard, where relevant, to the principle that funding under section 25 should not be provided for the provision of services, benefits and capital works which would usually be provided by core government spending when giving any direction under section 26 or 36E.""

Viscount Astor: We now move to the thorny and difficult issue of additionality. One of the problems there has been throughout the debate as this Bill has passed through another place and this House is that the Government have always accepted the principle of additionality but have never admitted when they have broken it. It is perfectly clear that they have broken it on a number of occasions. Indeed, that is not just my view but is also the view of the National Audit Office and of the Culture, Media and Sport Select Committee in another place—which, I remind the Minister, has a majority of Members of his party.
	The question is, what can be done about it? I wish to discuss my Amendment No. 13 and Amendment No. 14, which concerns reporting, in the name of the noble Lord, Lord Clement-Jones, in the next group. We need to have a debate about the principles of additionality. I shall not go through the list of what has been given out. Every time that is brought up in another place the Minister tells the various Members who have spoken what their constituencies have received. However, I want to consider the principles of additionality. The Minister, Mr Caborn, said:
	"The Government provide money to some charities, which is not core Government spending. Does that mean that the lottery should not give more to charities? The Government provide money to arts, sports and heritage in many areas—that is not core, or mainstream, Government spending. Does that mean that lottery funding cannot be used as well?".—[Official Report, Commons, 19/1/06; col. 1013.]
	I was rather amazed by that. I do not know whether the Department for Culture, Media and Sport has changed since I was there or, indeed, since my noble friend Lord Brooke was there but handing out money that was not core is not something that we would have got past the Treasury, which had a rather clear view of what was core spending and what was not. I do not think that when my noble friend was Secretary of State he ever handed out government money that was not core. Mr Caborn's statement is therefore extraordinary and I should be interested to hear how the Minister can justify it or perhaps explain to us what it means. It seems to me that when a department hands out money it is core spending. When the Government hand out money to the arts or sports, they do so through various distributing bodies, for example, the Arts Council. The argument put forward by Mr Caborn does not hold water.
	A further argument put forward was that the process would be subject to legal challenge. I am not aware of many legal challenges to the lottery being brought forward at the moment and I do not think that defining "additionality" would increase that likelihood. I am told—I would be interested to hear the Minister's comments on this—that the distributors of the Community Fund were sometimes concerned that if they did not award grants, they would be challenged and that they were almost pressed into awarding grants because they could not adequately define their reasons for not giving them. We believe that the distributing bodies should have the freedom to decide whether to give grants. Then we are in the lucky position of applauding the decisions that we like and criticising those we do not—that is the nature of it. We believe that the distributing bodies should be independent of government. However, as we have heard throughout the passage of the Bill, the Government want to exert power when they decide to do so.
	The Minister said in another place that the distributing bodies would report on additionality. That is interesting for two reasons. They will comment on that only in the reports that they publicise and lay before Parliament. That is merely a commitment; we have no way of making it happen. They do not have to do it. That measure certainly needs to be written into the Bill. The matter is interesting in that it opens up the whole concept of how they are going to do it. If the distributing bodies are to report on additionality, how will they define it? The Minister must think that they can define it if they are to report on it. If it can be defined by the distributing bodies, it can be defined in the Bill. You cannot have it both ways. The distributing bodies are going to report on additionality.
	The Minister might look at my amendment on core government spending and say that I have not used the right words. I am happy to discuss any changes that could be made to the wording of my amendment but it seems to me that the principle is sound. If the distributing bodies can report on what is additional and what is not, it must be possible to have that protection in the Bill. The Minister in another place has given a commitment that that will happen. This is such an important provision that we need it in the Bill.
	If the Minister were able to say that the principles of additionality have been broken but we shall ensure that they are never broken again, that might go a long way to satisfy us, but, unfortunately, I suspect that the Minister will be unable to give us that commitment at the Dispatch Box. That is why we need something in the Bill. I remain flexible. I am not entirely sure whether my amendment or Amendment No. 14 of the noble Lord, Lord Clement-Jones, is the right one. However, the principle needs to be in the Bill to make it clear to everybody. It needs to be included—I refer to amendments that we discussed earlier—given the new, large, wide-ranging powers that the Government have to prescribe. Those powers of prescription relate to the Big Lottery Fund which, after all, will take 50 per cent of all the funds available to the distributing bodies. Therefore, this is an important principle that we need to debate. We need something in the Bill as a protection in that regard.
	The Minister may tell me that my amendment is unworkable, in which case I would be delighted for him to advise me what would work. I am sure that he will be kind enough to do that. I hope that the Government will accept the important principle here. I beg to move.

Lord Phillips of Sudbury: I intervene only because the whole additionality principle was extremely important when I was on the National Lottery Charities Board, which I had the honour of serving during its first few years. Two issues exercised us greatly then, and I have no doubt that they exercise the different boards no less now: first, their independence from government and, secondly, additionality. We set sail originally on the absolute assurance by the Conservative government of the day that the boards, and the National Lottery Charities Board in particular, would not be expected to fund those expenditures which were the normal obligation of government to fund. That was felt to be particularly evident in the health and education sectors, and yet as we know there have been quite a few expenditures in the intervening years that I would have said breached that principle. It is not only me who is saying that; many are saying it.
	For example, in the NHS the National Lottery Charities Board has funded a good deal of advanced medical equipment that is available in some hospitals through government expenditure but which had not been available in other hospitals. There is considerable virtue in trying to get a handle on that thorny issue if at all possible. I say "if at all possible" because I well sympathise with the Government and the parliamentary draftsmen on how to incorporate this principle—if you can call it a principle—in legislation in a way that will not cause as many problems as it solves.
	The noble Viscount has advanced a bold and useful amendment, and I will listen not merely attentively but with fascination to what the Minister says. My sense is that the wording of the amendment is defective in a number of respects. The noble Viscount made no particular claims for the merits of the wording; he was merely trying to get the issue into play. To talk about core government spending is a dubious advantage, because I doubt very much that it is possible to say what "core" is in this regard. No doubt the Minister will come back on that.
	I want to say something about Section 26 of the National Lottery etc. Act 1993, which gives significant control to the Secretary of State over the distributing bodies as to the,
	"matters to be taken into account in determining the persons to whom and the purposes for which . . . and in determining conditions"
	subject to which the body distributes any money. Proposed new Section 36E is entitled "Directions", and it concerns the Big Lottery Fund. One sees there a creep in government control, because there is no doubt that the directions that can be given under proposed new Section 36E are considerably wider and more specific than the controls permissible now under Section 26 of the 1993 Act. The directions include the power of the Secretary of State not just to give directions as to the matters to be taken into account but, if this Bill goes through, to specify the persons to whom the fund may make grants, the purposes for which the fund would make grants and so on. That is evidence of what one might call a natural inclination of government to claw as much power into the hands of the Secretary of State as possible. No doubt all governments are strapped for cash at different points in time, and the more power they have to direct those funds in the different distributing bodies the more it can be used in effect to replace state funding. I could quite understand that if I were sitting where the Minister sits, I should be quite happy to see those powers retained in the Bill.
	All of that is another way of saying that, if it is possible, we should have something in the Bill on the issue of additionality. It goes to the heart of the way in which the National Lottery was established, and it would give great confidence to the different boards that they are not going to be put under undue stress by governments of whatever hue. I support the intent of the amendment.

Viscount Eccles: If the noble Lord, Lord Phillips, were to look at the 1998 Act, he would find that Section 43 on the New Opportunities Fund went just about as far as the clause in the Bill. That is not my reason for saying a few words now. The simplest arithmetic way of dealing with additionality would be to follow the Minister's assurance that the Big Lottery Fund will be able to manage its own affairs and to encourage it to increase the 60 per cent or 70 per cent that it puts into the voluntary and community sector to 80 per cent or 90 per cent. If the definition of the sectors puts the statutory sector as number one, the private sector making and distributing profits as number two, and voluntary and community sector as the rest, it is certain, is it not, that the higher the proportion that goes to the voluntary and community sector the greater the additionality?

Baroness Pitkeathley: I cannot support the amendment, largely because of the enormous difficulty of defining additionality. There is a pretty misguided view about how decisions on lottery funding are taken, especially with regard to the Big Lottery Fund and certainly how they were taken in the New Opportunities Fund. The image is that the Government speak and make their view known and lottery boards roll over. It is not like that. In my experience—which, like that of the noble Lord, Lord Phillips, is extensive—all lottery boards agonise over their decisions. One of the things that they agonise about most is additionality. The whole issue is a moveable feast. With the greatest respect to the noble Viscount, it is easy to table an amendment that talks about things "usually" being provided "by core government spending", but defining what is usual or core is pretty difficult. The idea that lottery money will somehow enable government to renege on their existing commitments or ignore need is wrong.
	I shall cite a couple of examples. The New Opportunities Fund in its initial allocation spent more than £50 million setting up out-of-school-hours childcare. It was enormously successful, with breakfast clubs, after-school clubs and so on. Now we see that extended school hours are becoming the norm, and we shall soon see that funding as usual and core to government expenditure; but it was not usual and core when that project started.
	Another example for which NOF has been widely criticised is giving money to health authorities to buy linear accelerators and MRI scanners and equipment of that kind. Again, it was not as simple as that. The New Opportunities Fund, as other distributors, was charged to focus on disadvantaged individuals and communities. We tried to even up the balance of access to such equipment. Is a scanner bought by public fundraising in a wealthy area additional? That is how many of them are bought, as noble Lords know. Any such equipment was not going to be provided by public subscription in poor areas. The New Opportunities Fund evened up that balance a bit. Anywhere that there was a commitment to buy such equipment in the current or future plans of the local authority, no lottery funding was made available.
	Now that the equipment has been made available more evenly, the revenue costs fall on the NHS. Those examples—and I could give many others—show the need for extra, not less, core government funding. These are not easy decisions, but we should remember that lottery boards are made up of wise, experienced and independent people who struggle with these issues on our behalf. We have made great progress towards meeting the concerns. The Big Lottery Fund will be open about its decisions, and each distributor will report regularly to Parliament on additionality issues. They will report the kind of debates and agonising decisions which I have set before your Lordships this evening. We have gone as far as we can in the Bill in an area that calls for endless flexibility and continuous reassessment, rather than exact definitions.

Lord Smith of Finsbury: I endorse the words of my noble friend Lady Pitkeathley, who performed a magnificent role in her task as the leader of one of the lottery boards. She clearly identified the central difficulty of this discussion, because the principle of additionality is sensible and vital. It rests on the concept that what lottery boards spend should not replace government spending, but should add to it. That is the heart of the principle, but the moment you go beyond the heart and you try to put it in black and white into legislation, it becomes much more difficult.
	I would defend to the hilt the fact that the Government's spending from the Exchequer on the arts, sport and heritage are core government responsibilities. I would defend to the hilt the fact that they should be and, I hope, always will be, part of the usual expenditure of government. But we have happily accepted that lottery boards' spending on arts, sport and heritage is fulfilling completely the additionality principle. I would argue that exactly the same point applies to the activities to be supported by the Big Lottery Fund. Exactly the same point applied to the activities and facilities that were supported by the New Opportunities Fund. It is very difficult to tie in place by some neat definition the broad principle that we endorse on all sides of this House. The Government have broadly got it right in this legislation. I would be sad if in searching for something even better, we actually to make it worse, and I fear that that is what we might be in danger of doing if we tried to tie that too precisely with the wording proposed in the amendment.
	The principle is right. I look forward to hearing the Government's ringing endorsement of the principle and ensure that the people they appoint to run the lottery boards understand the importance of that principle, too. Let us not try to make the best the enemy of the good.

Lord Clement-Jones: By speaking at the tail end of this debate I have a major advantage in that I can agree with almost everything that noble Lords on both sides of the argument have said. I very much support the spirit of the amendment. It would be highly desirable to have a definition of additionality in the Bill, but it is a holy grail—in both 1993 and 1998 attempts were made to try to formulate an appropriate definition.
	Mr Caborn, as the noble Viscount pointed out, did himself no favours when he responded on the additionality argument. He made a series of different blusters. I would never accuse a Minister of that kind of language. It would be a "lawyer's paradise"; it would result in bureaucracy—there was a series of unconvincing reasons. The reason that appeared not to have been given was the difficulty of definition, which I would have thought should have been the first argument to be made.
	The strange thing about the issue is that at the higher level, as the noble Lord, Lord Smith, pointed out, we all agree that additionality was one of the founding principles of the National Lottery and if we left matters there, we would probably all be in wild agreement on that principle. But when you reach the second tier, the NCVO, for example, defines additionality as funding additional to that which is properly funded by government and not a substitute for it and that it should not be used to fund essential services or government-inspired programmes.
	The noble Baroness, Lady Pitkeathley, pointed out that you can shift, and that the voluntary sector often paves the way for government funding, which creates its own set of difficulties. The Minister made a valiant attempt on Second Reading to define it in a broad way. He said:
	"There is a very big difference between agreeing priorities and outcomes that align with government priorities and using lottery funding to substitute for government expenditure. We are not doing the latter".
	He continued:
	"Lottery money is not just for spending in areas where no government spending would ever take place. That would be an impossible situation. We expect the lottery to spend on top of things which government would normally fund".—[Official Report, 6/2/06; col. 498.]
	We probably agree with the first half of what the Minister said. In the second half he almost reaches the point of saying, "If it isn't in the budget for this year for a particular government department, then it is additional". Such matters require careful teasing out, which illustrates the difficulties and why the amendment that we shall consider later might be preferable.
	It is extraordinary that even after 13 years we still do not have a working definition that is agreed by all parties—government, opposition and the voluntary sector. It is high time that we had some sort of definition and I very much hope that the distributors, by inserting in their annual reports what they believe to have been additional, will help to define matters—because each will need to consult with the others on how they describe it. The 60 per cent to 70 per cent rule mentioned by the noble Viscount, Lord Eccles, will be helpful in that regard and we may, in time, arrive at a working definition.
	For the moment, I would say "Yes, in spirit", but I am not sure that we are quite there.

Lord Brooke of Sutton Mandeville: I recall the 1993 Bill and the debates that we had on additionality in the Commons, including the Opposition's attacks mounted by the noble Lord, Lord Pendry, as he is now and who has temporarily left his place. The Opposition's pressure was considerable and totally proper. One of the outcomes was that after the Bill became law there was major emphasis on capital projects by the various distributors, because no one could have suggested that they were not additional, given that they had not previously existed.
	There was an example of British genius, particularly the genius of Lord Rothschild, the then chairman of the National Heritage Memorial Fund. It occurred to him that as Secretary of State I was also the chairman of the Millennium Commission, which was one of the distributors. He asked me quietly, "Would it be helpful if I gave a dinner for the chairmen of all the distributors, to which you would come in your capacity as chairman of the Millennium Commission, so that we could have an informal discussion on the kind of directions and guidance it would be helpful for the Secretary of State to give all of us, including me?". That occurred, and—this is a totally egotistical remark—my appreciation of Lord Rothschild in that regard was that it enabled us, in the directions and guidance, to emphasise architecture as something the distributors should emphasise in decisions relating to the various applicants. That was an example of British genius, for the coincidence of resources with the reputation of British architecture in that era meant that we could reinforce a category of artists who, while not pre-eminent in the world, were widely spread throughout the world.
	Regarding the problem of prescription, which occupied us earlier and which underlies this issue, I remind the noble Lord, Lord Smith of Finsbury, who led the Department for Culture, Media and Sport during the evolution of the Labour Government's policies on these matters, of a magical moment when he was due to make a Statement on the future of the National Lottery later that afternoon. By coincidence, perhaps by convenient coincidence, DCMS Questions were being asked at 2.30 pm. I took the liberty of asking his Minister of State, Mr Tom Clarke, to remind the House of the Government's current definition of additionality. Mr Clarke fell back on saying that if I did not know, the Secretary of State would be letting us know later in the afternoon. But it suggested that his mastery of the policy at that moment was not absolutely overwhelming.
	This is an immensely worthwhile debate and I am looking forward to the Minister's reply. I am conscious of the dinner hour and shall sit down shortly, but I will ask again the paving question that I asked on Amendment No. 2. When, particularly in the context of the Big Lottery Fund, it is determined whether additionality is being practised or offended against, does the primary responsibility lie with the Secretary of State in the prescriptions that he gives or with the chairman of the distributor body in carrying out its part of the equation?

Lord Davies of Oldham: This has been a fascinating debate and, like the noble Lord, Lord Clement-Jones, the Government agree with the spirit. That is the nature of the problem, but we are dealing with legislation. At Second Reading, I challenged the Opposition to come forward with an amendment that would work in legislation. We all subscribe to the principle—that was enjoined in the early days of the development of the National Lottery. The noble Lord, Lord Brooke, expressed just how categorical one could be about certain areas where one could say, "We'll support capital projects". There was a clear definition, because those projects were not undertaken by the government of the day and they were clearly additional. But we all know that the lottery has moved on considerably in recent years and there is a whole range of expenditure where matters are by no means so clear. I was enormously grateful to my noble friend Lady Pitkeathley, who has vast experience of these matters, for identifying just how difficult this issue is. She defined the problem with accuracy and was supported by my noble friend Lord Smith, who has also had enormous experience in this area.
	Of course, we all support the spirit. I make no bones about it: we are not going to resile in any way, shape or form from the spirit of additionality. We challenged the Opposition to produce an amendment that would translate this issue into effective law because, with our combined resources through two Administrations over more than a decade, we have not been able to do so in a satisfactory way. That is the nature of our problem.
	I heard the noble Lord, Lord Clement-Jones, castigating my right honourable friend Mr Caborn. As I understand it, Mr Caborn was merely saying, "I have a department whose core funding is quite clear. It spends a great deal on the arts; it spends a great deal on sport; and it spends a great deal on other worthwhile projects. I don't know where it ends and the National Lottery begins easily in these terms". I imagine that the Minister of State, replying to the noble Lord, Lord Brooke, who was then in the Commons, was wrestling with the same problem. We all do, as do the Opposition in putting forward this amendment. As the noble Lord, Lord Clement-Jones, indicated, it is not a satisfactory position. I give way to the noble Lord.

Viscount Astor: I am grateful to the Minister for giving way. As he mentioned what Mr Caborn said in another place, perhaps he can answer this question. Mr Caborn said:
	"The Government provide money to arts, sports and heritage in many areas—that is not core, or mainstream, government spending".—[Official Report, Commons, 19/1/06; col. 1013.]
	Can he tell me what that money is if it is not core government spending and not lottery money?

Lord Davies of Oldham: It was clear what I was seeking to indicate with regard to my right honourable friend's answers. The department is involved in expenditure in areas where, particularly with regard to the Heritage Lottery Fund but also with regard to the distribution of sports funding, it is difficult to draw the dividing line in the way that my noble friend Lady Pitkeathley indicated. Scanners were provided by public subscription and contribution, by charitable donations and by the goodwill of communities. As my noble friend rightly said, it tended to be the communities with the greatest resources that first produced scanners. However, I am proud of the fact that the Royal Oldham Hospital, through hard-earned public subscription, had a scanner at the very early stages of development of this medical aid. That did not alter the fact that, through the lottery, additional resources were made available to contribute to the cost of the scanners and equalise the position across the country. That clearly came outside core funding. The Department of Health had no programme for such scanners and they would not have been delivered under the Department of Health as quickly as they were, but they were delivered because of National Lottery funding.
	Today, the revenue costs of scanners are now core funding in the Department of Health, so these things change over time, as they are bound to do. That is why the problem of additionality has defeated the noble Lord. He indicated his intentions at Second Reading and I admire him for his effort. The noble Lord, Lord Clement-Jones, quoted what I said at Second Reading and I am grateful that he did. I tend to agree with his comments about what I said at Second Reading—it was extremely meritorious and well worth repeating. But he may recall that at that time I did not say that I would be putting this into legislation—I had a Bill before me in which I was absolutely clear that we could not do so. I said at Second Reading that this was our concept of additionality. This was the spirit—the noble Lord's word—within which we would work to promote additionality. But I do not think that it can be achieved in legislation, as I believe this debate has proved. I give way to the noble Lord.

Lord Phillips of Sudbury: I shall be very quick. I cannot resist pointing out that this Government are saying that they cannot find legislative words for the concept of additionality when we have been arguing for months about glorification, which I should have thought was an infinitely more rubbery concept. What about subsidiarity? That is at the heart of EU legislation.

Lord Pearson of Rannoch: Shame.

Lord Phillips of Sudbury: Maybe. Will the Minister not concede that it might be possible to adopt either the definition given by the noble Lord, Lord Smith of Finsbury, or that of the NCVO—what one might call a very broad common-law definition of additionality—and leave that in the Bill without lots of conditional words? There would just be the broad common-law principle, which would achieve the purpose without obstructing the workings of the boards.

Lord Davies of Oldham: The noble Lord has the advantage over me of being a lawyer, but I do not know how he translates a common-law principle into a Bill, which will become an Act of Parliament, without giving a precise definition of certain phrases within it. What would core government funding mean in these terms? I shall not berate the Liberal Democrats at this stage, because I have the noble Lord, Lord Clement-Jones, on my side for once in spirit. But in its manifesto at the last general election, the Conservative Party proposed a club-to-school scheme—a scheme under which every child would have the right to two hours of free after-school sports coaching paid for with £750 million of National Lottery money. There is an interesting concept of the voluntary contribution from school teachers in providing support and coaching children as against this additional money—or would it be separate money? Would it be part of government core funding? Clearly not, because the Conservatives intended it to come from the lottery. But we would be pressed to say that no element of after-school coaching in sport for children has anything at all to do with the Department for Education and Skills or the provision that it makes. This distinction will not stand up.
	That is the nature of the Conservative Front Bench's problems—not that I am berating it for making the attempt. In fact, I am guilty of encouraging it, on Second Reading, to try to do that. I greatly applaud its effort. Unfortunately, I can only give marks for incorporating amendments into legislation if they deserve 10 out of 10. As the noble Lord, Lord Clement-Jones, and many others have said, the amendment falls far short of being 10 out of 10, and will not do for legislation. It will not work, although it is a good try. That is why I hope that the noble Viscount, Lord Astor, will recognise that his amendment will have to be reconsidered and withdraw it.

Viscount Astor: I am grateful to all noble Lords who have spoken in this debate. I am delighted that the Minister read our manifesto with such care; I have to admit that I did not read his with equal care. Anyway, this was a debate in the other place—I occasionally read the Hansard of the other place—so I am not going to go into it, because it was adequately answered. I recognise the difficulties of addressing the concept of additionality and putting it in legislation in some form. We will move on and make better progress in the consideration of the next amendments when we come to them. This has been what you might call a "pre-debate" on them.
	The Minister did not answer the question posed by my noble friend Lord Brooke of Sutton Mandeville on when the distributing bodies will have to report on additionality. Will it be their responsibility to make their own definitions, or will they have to take account of directions given by the Secretary of State, who has this additional new power, as the noble Lord, Lord Clement-Jones, is constantly reminding us? It would be helpful—and the Minister can leave the answer until the next set of amendments—to know whether there is going to be any guidance to the distributing bodies, and how they are going to report on additionality. The Government are saying, "We accept the principle, but cannot define it in legislation, so we are going to give it to them to report to us". We need to know how that will work. Is the Secretary of State going to write to them and say, "Please do this, and this is how we suggest you do it"? We will need to debate those issues. Perhaps, however, those questions are more germane to the reporting bit coming up in the next set of amendments.
	I remind the Committee that this has happened because the Government have created the Big Lottery Fund—which has 50 per cent of funds—and have given themselves so much power to prescribe what this distributing body will do. That is why we are concerned with additionality. We would not be having this debate if the original four good causes had remained; it would not have been necessary. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Evans of Temple Guiting: I beg to move that the House do now resume. In moving this Motion, I suggest that Committee stage begin again not before 8.44 pm.

Moved accordingly, and, on Question, Motion agreed to.
	House resumed.

Botswana

Baroness Tonge: rose to ask Her Majesty's Government what is their assessment of the social and economic progress made in Botswana since independence.
	My Lords, in the last few years, I have visited many African countries. It is difficult not to get depressed when one travels around that continent. It is difficult to know where to begin with the multiple problems most African countries have. It was so refreshing when, in 2002, I visited Botswana with some noble Lords from this House and Members from the other place.
	Botswana is an African success story. Admittedly, it has a small population of 1.7 million, but it has nearly 80 per cent literacy, which is beyond the wildest dreams of many of the other countries that I have visited. Education is totally free for the first 10 years, as it has been for many decades. Grant loans are given for university education, which many Botswanans take advantage of. Healthcare is largely free and there are good clinics and hospitals. Botswana has had one of the world's highest economic growth rates since independence in 1966 and is now classed as a middle-income country. I will give no more details of the economy of Botswana, because my noble friend Lord Chidgey will be speaking on that later.
	How has this happened? As I am sure noble Lords will know, in 1966, just after independence, De Beers discovered diamonds in Botswana. Instead of allowing this huge multinational company to exploit Botswana's riches and line its own pockets, the government went into a 50:50 partnership with De Beers, forming the company Debswana. The arrangement should be looked at as a model for other developing countries. It has given Botswana a head start over everyone else; 70 to 80 per cent of its export earnings have come from Debswana, and the public services and infrastructure have been enjoyed by all people as a consequence.
	However, dependence on one industry is not ideal. The Government of Botswana seek to diversify in their Vision 2016 development plan. Tourism, financial services, subsistence farming and beef cattle farming are due to be encouraged, as well as further mining in other areas. It would be a tragedy if this development plan failed. The Government of Botswana face huge problems. In common with many sub-Saharan African countries, the population is over 25 per cent HIV positive, which affects skilled workers, professionals and, indeed, the business plans of all companies working in the country. This is being tackled by another partnership with a multinational company and the Bill Gates foundation—which my noble friend Lord Jones of Cheltenham wishes to speak about later, so I will not go into detail on that either, to save time. There is high unemployment—24 per cent in 2004—which is why the government want to encourage investment in and expansion of other sectors to provide more jobs.
	Unfortunately, the government are being attacked, and investment hindered, by an NGO campaign from this country to discredit Botswana and its government. Survival International, a British NGO, has been waging war against the Government of Botswana over their treatment of the San people, the Basarwa, known commonly as the Bushmen of the Kalahari. When the Central Kalahari Game Reserve was established around 1961, there were a few thousand Bushmen still in that area. They were hunter-gatherers, with ancient tracking and water-detection skills, killing animals with primitive bows and arrows—on our visit we saw some of them in action. It is very romantic stuff and sounds absolutely wonderful—the stuff of boy scouts. Great if you are a successful Bushman, maybe, but not so great for the Bushwomen and Bushchildren, who have a right to healthcare and education and who may not want to stay in the stone age with their families; they may want an opportunity for another life. In fact, one Basarwa female student has just gained a PhD at a university, which shows what can be done and what aspirations they may have if given the opportunity.
	In recent years, the Bushmen have started hunting with guns, often on horseback or even in old 4 x 4 vehicles. They also demand the right to herd cattle and keep livestock in the Kalahari, which sometimes get eaten by wild animals. The domestic animals not only disturb the ecology of the Kalahari but, when they get eaten by wild animals, the Bushmen also demand compensation from the government. It was impossible for the government to provide education and health services, which the people have a right to, in this terrain and it was very difficult to recruit staff to work in those areas.
	It is worth remembering that the Central Kalahari Game Reserve is 50,300 square kilometres, which is about 40 per cent of the size of England—we are talking about a huge area. Consultation took place between the government and the Bushmen. The majority opted to move to the edge of the game reserve—to New Xade and Kaudwane—where they were given houses, water, schools, relocation allowances and livestock to earn a living. A few Bushmen remained in the game reserve on condition that they pursued their traditional way of live, which they did not. Over time, they brought in livestock and hunted game with guns. These few people, backed by Survival International, are now holding the Government of Botswana to ransom, and a court case is proceeding for the restitution of their land in the Kalahari. The sustainable development of the game reserve, with its fragile ecology, is being held up and the international community is beginning to worry about investment in Botswana. Tourism, which the government wish to encourage, is suffering.
	Survival International has alleged cruelty toward the remaining Bushmen, which has not been substantiated—the allegation has been thoroughly investigated. It has also alleged that De Beers wants to mine the area. Investigations have taken place and De Beers has said that there are no substantial diamonds worth mining in the game reserve. But, even if it did at a future date decide that it was worth doing that, we are talking about a mine that would occupy a very small area, compared with the whole of the game reserve. Nevertheless, De Beers is being targeted by Survival International quite unfairly, especially when we must remember that the company was the instigator of the Kimberley agreement to stamp out conflict diamonds.
	Survival International is using hysterical language to whip up international support. The director, Stephen Cory, said that the relocation of Bushmen is "tantamount to genocide". That is a bit much. He refers to,
	"diamonds dug from the Bushmen's grave".
	These tactics and this language have been condemned even by Botswanan NGOs. BOCONGO—a wonderful acronym; it stands for the Botswanan Council of Non-Governmental Organisations—which includes a lot of human rights organisations, has told Survival International to stay out of it and that it would rather deal with the matter.
	I do not wish to deny that there is a problem here, not just for Bushmen, but for indigenous people in many parts of the world where development has fallen way behind that of Homo sapiens generally. But some sort of balance has to be struck to try to provide for their needs. The UN has produced a draft resolution on their rights, but we must consider the rights of women and children and of those Bushmen who maybe want to choose education and development. We must also consider the rights of the rest of the people in Botswana to prosper and to use their country's resources for the good of the whole county, which Botswana has tried to do ever since independence. It would be a tragedy if this vindictive campaign succeeded in derailing the progress of one of the few successful countries in Africa. I hope that the Minister will reassure us that Botswana can count on the support of this Government.

Lord Giddens: My Lords, I congratulate the noble Baroness, Lady Tonge, on initiating the debate. Africa gets a terrible press in western countries. It needs some shining light, and, along with Ghana, Senegal and some other countries, Botswana is one of those shining lights. It is in fact a favoured child of the World Bank and the IMF, even though it is one of the few countries in Africa that have never deployed their structural adjustment policies. Some might say that there is no accident there.
	I met the president, Festus Mogae, a few months ago and had some interesting discussions with him. I was very impressed with the rational and sane nature of the policies he outlined. I think that it was a very balanced analysis of the opportunities facing the country, and also the problems that it has. Botswana, as the noble Baroness said, has a small population, but in some ways it is a model of development, economically and politically—economically because it has had a high growth rate for a long time, and politically because it enjoys notable stability, especially against the background of sub-Saharan Africa in general.
	The country could not be said to have a diversified economy. It is heavily dependent on diamond mining—about one-third of GDP and 70 per cent of export earnings come from this source. However, its success is due to the fact that these resources have been very well managed and the country, as a whole, has followed sound macroeconomic policies. Of course, the fact that it has a stable parliamentary system has made a lot of difference. All foreign observers agree that elections have been freely and fairly contested and held on schedule. As the noble Baroness mentioned, it has also pursued sound environmental policies and its game parks are a model for other parts of Africa.
	However, the country has serious problems. Well over 40 per cent of the population still lives below the absolute poverty line, although that proportion has come down from an even higher proportion. In the document to which the noble Baroness alluded, Vision 2016, the Government want to reduce this proportion to 27 per cent in the short term and by 2016 wants the country to be the first African country free of absolute poverty—subsistence poverty. The World Bank, I think rightly, assesses that the country, all other things being equal—and they are not all that equal—has a decent chance of achieving that.
	Secondly, the unemployment rate is still high—more than 20 per cent in some areas. Unfortunately, a good deal of that unemployment is long-term. Thirdly, levels of economic inequality are unacceptably high. Many commentators have focused on that. There is a wealthy elite. A lot of people live in poverty, and the division between them is still much too big. It needs to be bridged.
	Fourthly, of course there is the issue of AIDS. To their credit, the Government have followed a quite different policy from South Africa and have, I think, been successful in providing antiviral drugs to their population. They have had a very enlightened policy in that area, of course with assistance, as has been mentioned.
	The latest statistics show that the country no longer has the world's highest HIV infection rate, but many people still think it remains on the edge of potential disaster. I hope the Minister will comment on this because assessment of the impact of AIDS is quite difficult. There are divergences between different commentators on the actual level of HIV infection and AIDS in the country, and, of course, people who survive with HIV are a measure of success, not just a measure of failure. The issue is more complicated than it might appear at first sight.
	I have quite a few points which I would like the Minister at least to consider commenting on. First, what actually can be done to promote diversification? The Government are, quite rightly, seeking to diversify the economy, but it is difficult. Many people have expressed the view that one of the reasons for the difficulties of diversification is the size of the public sector in the country. Does the Minister share that view? I suspect, however, that it is the policies followed that need some outside assistance and advice.
	Secondly, Botswana is a low-risk country in terms of international risk assessment. Moody's Investor Services gave the country an A-plus credit rating recently. However, FDI is not well developed. Thirdly, the country speaks English. Can it make progress in the world of information technology as some poorer countries have done quite effectively? Fourthly, what is the Minister's assessment of the AIDS issue, especially in relation to inequality? There is quite a controversy among students of the country about whether that will have an impact on equality, quite apart from all the other potentially catastrophic effects that it could have.
	The Prime Minister and the Chancellor have, rightly, put Africa at the top of the agenda. They are to be congratulated on that. Of course, they have concentrated, as have the entire Government, on the more problematic areas of Africa, but I hope that the Government and the Minister will recognise that it is just as important to try to help those countries which are becoming successful, because they blaze a path for others in future.

Lord Chidgey: My Lords, since independence, the Government of Botswana have made a determined effort to raise education and skill levels and to bring added and diversified value to the economy. Unusually among African states, the Government offer 10 years' free education to all children. Remarkably, enrolment rates in primary and junior secondary schools are close to 100 per cent. Most significantly, girl pupils are believed to outnumber boy pupils at both levels.
	Since independence, as my noble friend Lady Tonge mentioned, adult illiteracy has fallen below 25 per cent. That compares to 40 per cent on average for sub-Saharan Africa as a whole. In 1966, an overwhelmingly rural population depended on agriculture and livestock for a livelihood. At that time, only a minority had access to proper healthcare, safe water and schooling. By the 1990s, infant mortality had fallen to fewer than 50 per 1,000 live births, compared with the average in sub-Saharan Africa of more than 90. Life expectancy had risen from a little over 40 in 1966 to 67 years by 1996. From almost no access to healthcare, about 90 per cent of the rural population now lives close to a primary health post and village water supply schemes cover almost the entire country. That is some success story.
	However, it is an immense tragedy that, during the past decade, many of the achievements in economic, social, educational and health development have been put at risk through the rapid and inexorable spread of HIV/AIDS. Botswana is one of the countries most affected by HIV/AIDS in the world. Average life expectancy, which had risen from 40 to 67 years by the mid-1990s, has now fallen dramatically to only 32 years.
	The enormous direct costs of care and treatment are accompanied by devastating human and social effects, but underlying those effects is a deeper, long-term loss to the economy. In neighbouring South Africa, for example, the HIV/AIDS attrition rate in the labour force in the mineral extractive industries can cause a 100 per cent turnover of employees every four years. There is no reason to believe that Botswana is faring any better. It is more likely that it is faring far worse.
	It is clear that Botswana's continued progress is threatened by the HIV/AIDS epidemic, but there looms another threat to Botswana's economic and social development. The very positive per capita GDP of $US9,200 masks a large disparity in income distribution. In a country already prone to drought, as has been mentioned, 40 per cent of households in rural areas are believed to be living in poverty.
	We tend to consider global warming in the context of melting ice caps and rising sea levels threatening low-lying island and coastal communities. We should not, however, overlook the potential impact of global warming on Africa, particularly the semi-arid areas of southern Africa. The potential impact of global warming in the region has been the subject of studies at Oxford University, the University of East Anglia and throughout Botswana by specialist consultants. Most worrying is the predicted effect on the Kalahari dune fields, which cover 2.5 million square kilometres from the northern end of South Africa through Angola, Botswana and Namibia to western Zimbabwe and western Zambia. Some computer study models are now predicting that those dune fields, currently stable under vegetation, will start to erode and move as rainfall decreases and wind speeds rise under global warming. If the Kalahari sands start to shift as predicted, tens, or, possibly, hundreds of thousands of already impoverished people in rural communities will be affected.
	Because of Botswana's GDP strength, the United Kingdom and the European Union are now the only substantial providers of development assistance. It is therefore vital that we do not lose sight of threats from global warming because of the immediate HIV/AIDS crisis. We must take a longer view of our development assistance. We must ensure that the policies and programmes that we promote, sponsor and support in Botswana are designed to address the impact from global warming. We must not ignore the threat of existing semi-arid areas turning into deserts well before the end of this century.
	I look forward to hearing my noble friend's response to what I consider to be important and far-reaching concerns.

Lord St John of Bletso: My Lords, I join in thanking the noble Baroness, Lady Tonge, for introducing this short debate. It is right and proper that we recognise the social and economic progress made by Botswana since independence.
	Botswana has become one of the world's largest producers of diamonds but, around the world, an abundance of natural resources has often given no guarantee of the success of that country. Perhaps Botswana's greatest achievement is the political stability that it has achieved since independence. The country has benefited from a succession of strong leaders with an equally strong commitment to genuine democracy. The fact that both the previous president, President Masire, and the current president, President Mogae, were Ministers of Finance before coming president has ensured a strong fiscal strategy.
	Transparency International ranks Botswana as the least corrupt country in Africa and the 25th least corrupt country in the world. Solid institutions and the intelligent use of technology have made the country more competitive than countries such as Mexico. Of course, the country has been challenged in the past 40 years, most significantly, as noble Lords have mentioned, by recurring droughts and the HIV/AIDS pandemic. In both instances, Botswana's response has been clear and generally successful. The agricultural sector has been sustained despite the generally arid conditions, and Botswana now has one of the most advanced AIDS treatment programmes in Africa, with antiretroviral drugs now readily available. On his re-election in October 2004, the president declared his goal that Botswana should be AIDS-free by 2016. This is an almost impossible task, with adult HIV infection reported to be running as high as 40 per cent.
	I should like to touch on a regional issue. The international community is increasingly looking to Botswana to join South Africa to help to resolve the continuing crisis in neighbouring Zimbabwe. Botswana has developed a powerful voice, and many observers want to hear it raised. At the end of 2003, the Botswana Government constructed a 3-metre high electrified fence along the border with Zimbabwe. Officials explained at the time that its purpose was to halt the spread of foot and mouth disease, although it has been widely regarded as a measure to stop the flow of illegal immigrants across the border. Some 2,500 Zimbabweans are being deported across the border every month. It would also be encouraging to see Botswana use whatever means it may have at its disposal to bring pressure to bear on the Mugabe regime.
	The noble Baroness, Lady Tonge, mentioned the plight of the Bushmen, and I entirely concur with her views. It is, of course, a major problem, and the Botswana Government are expected to take action in their perceived treatment of the Bushmen. The Botswana Government have been accused by various international agencies—we have heard of the report by Survival International—of forcibly removing more than 2,000 Bushmen from their lands in the Central Kalahari Game Reserve, which occupies a land space almost the entire size of Switzerland, and compelling them to live in 84 designated resettlement areas on the fringes of the reserve. Many of the Bushmen have objected, but I take the view that it has been in the best interests of many of the Bushmen, particularly the ladies, to be in these designated areas, as it has given them more of an opportunity to get a better education. Perhaps the Minister could comment on the view of Her Majesty's Government on the plight of the Bushmen.
	A third area of international concern is whether the Botswana Government can provide effective conservation in the Okavango delta, a natural wilderness area of great value. The challenge is to set the right balance between real environmental imperatives and the temptation to maximise revenue from tourism. I thought that the noble Lord, Lord Chidgey, gave a very grave warning about the effects of global warming.
	In conclusion, I am optimistic about Botswana's prospects. In general, the international community's approach to Africa has been much more upbeat and positive in the past year. The developed world is minded to invest, support and nurture African countries that take steps to ensure that its judicial, political and social structures are strong, solid and effective. In the past 40 years since independence, Botswana has proved itself to be precisely such a country.

Lord Jones of Cheltenham: My Lords, I congratulate my noble friend Lady Tonge on securing this debate. As we have just heard, it is timely, as Botswana marks 40 years of independence in September. I draw attention to my interests in Botswana, which are declared in the Register of Members' Interests. I was also the initial chairman of the All-Party Botswana Group, which was formed in the previous Parliament, and I continue to be a member of the group.
	Noble Lords will be aware that Botswana was formerly the Bechuanaland Protectorate. In the late 1940s, there was a huge fuss because the young chief designate of one of the principal tribes married Ruth Williams, a young white Welsh woman, without the formal consent of his elders. The Attlee government gave way to pressure from the then recently elected apartheid government of South Africa and banished the young man in question from his homeland. His name was Seretse Khama. This shameful episode continued until 1956, when the UK government revoked the banishment order and Seretse and his family returned to Bechuanaland to a tumultuous welcome from the Bamangwato tribe. Seretse quietly set about rebuilding his life. He took up politics in the early 1960s and was one of the founders of the Bechuanaland Democratic Party—now the Botswana Democratic Party. My noble friend Lord Avebury was at university with Seretse, and I hope we will hear about that later.
	Bechuanaland became self-governing in 1965, basing its legislative assembly closely on the United Kingdom House of Commons. Seretse became the first Prime Minister after his party had been returned in democratic elections based on universal adult suffrage. In 1966, the country was granted full independence, with Seretse as the first president, and its name was changed to Botswana. I commend to noble Lords the book Under Two Flags in Africa, written by George Winstanley, who was with the Colonial Service and became secretary to the independent Botswana's first Cabinet. He also designed the country's flag, with its distinctive blue, white and black horizontal stripes.
	In 1966, Botswana was the sixth poorest country in the world. There were just 14 kilometres of tarred road in a country that is bigger than France and Belgium combined. The bulk of its meagre budget was provided by the UK in the form of grant in aid. However, as we have heard, shortly after independence diamond deposits came into production and the age of prosperity for the country began, so that by the early 1970s it had become financially independent.
	Seretse, and no doubt Ruth, too, decided to use the wealth created by this good fortune to improve the lives of the people. This was achieved by the formation of the 50:50 company Debswana, which was half-owned by the Botswana government and half-owned by the mining company De Beers. It has been a profitable partnership for both sides. The mining company did the mining and the government used the revenues to build infrastructure, roads, clinics, schools and housing to benefit all the people of Botswana. That is very different from what has happened in other African countries with rich mineral deposits, such as Sierra Leone and Angola, which have been ruined by a combination of corruption and civil war over who controlled the diamond fields.
	As a result of the example set by Seretse Khama and followed by his successors Quett Masire and the current President Festus Mogae, Botswana has prospered. The result is that Botswana is unique in Africa. In fact, before Nelson Mandela was released, it was the only functioning democracy in that sad continent. As we have heard, Botswana now has a literacy rate of almost 80 per cent and a per capita GDP approaching US$10,000—it is regarded as a middle-income country.
	I will finish by saying something about HIV/AIDS. On my first visit to Botswana with the CPA in 1999, we went to Jwaneng, one of the diamond mines near the capital Gaborone. We were told by the manager who gave us a presentation on the mine that he had received that morning the results of the first ever HIV test among his workforce. It showed that 30 per cent were HIV positive, right across the pay grades. How does any organisation build that into a business plan?
	Since that visit, I have followed with concern and interest the development of policies to try to deal with this huge problem. Debswana's actuaries showed that it is economically more effective to give each HIV-positive employee all the medication that they need to stay alive longer, so the company adopted that policy. The company also provides counselling to those employees who are disease free to help them to remain disease free. The country as a whole has now adopted those policies.
	Last week, the International Development Committee in another place visited Botswana. Its chairman, Malcolm Bruce, described Botswana as,
	"a shining light of democracy, where the rule of law and good governance reign supreme".
	He is right. Other countries in Africa should follow Botswana's example.

Lord Pearson of Rannoch: My Lords, I have been on only one political junket in my life: to Botswana in September 2002—and very agreeable it was. Not only were the noble Baroness, Lady Tonge, and the noble Lord, Lord Jones, part of the group, but we were given first-class air travel and generally treated as visiting royalty. I should point out that all this was paid for not by the Botswanan or United Kingdom taxpayer, but by Debswana, the diamond mining joint venture between De Beers and the government of Botswana.
	I was invited because for some years I had been asking questions in your Lordships' House about the mistreatment of the Bushmen of the Kalahari. The idea was to convince me and the other members of the group not only what a great place Botswana was but that the Bushmen had not been mistreated and that, even if some of them were unhappy about their forced eviction from their ancestral lands and way of life, it was really in their best interest.
	This latter part of our hosts' plan backfired badly, at least as far as I was concerned, but not, it would seem, for the noble Baroness, Lady Tonge, and the noble Lord, Lord Jones. I took the precaution of hiring my own interpreter, so I was able to hear exactly what some of the 200 Bushmen and their families who had recently been forcibly resettled in a camp at New Xade were saying. I heard them describe it as a place of death, where they had nothing to do but drink, take drugs and catch AIDS. Many of them felt that they had been evicted because Debswana wanted their land for its diamonds. They said that they did not want the diamonds; they just wanted their way of life. They said that there was plenty of room for diamond mining and for them, as indeed there is.
	I, for one, came home more convinced than ever that a great injustice was being done to these peaceful and dignified people. Since then, however, their treatment has grown even worse. Only some 30 Bushmen remain in the reserve after continuous evictions and 22 have been arrested for attempting to take food in for their relatives. Armed guards have prevented them hunting and gathering and have confiscated their livestock. One woman has recently starved to death and one man has died after he and seven others were tortured last June in the Kaudwane resettlement camp.
	In an attempt to regain their rights, which were guaranteed in Botswana's constitution when we gave it independence in 1966, 242 heads of families have brought a case against the government, which the latter is spinning out disgracefully. Nastier still, the government have removed Section 14(3)(c) of the constitution, thus prejudicing the judges' decision in their case, which relies upon that section.
	Why should one of the more reputable governments in Africa behave like this towards a minority of a different race? Certainly the reasons and justifications given by the government of Botswana are almost entirely without foundation. I had the benefit of seeing this at close quarters when I had a long conversation in June 2003 with the President, Mr Festus Mogae. He had come to London to promote Botswana's new financial services initiative, which I had helped with some valuable commercial information in the area of international insurance, in which I work. He was grateful for this but he wanted to persuade me that I was wrong about the Bushmen.
	What I found most distressing—and it has been worrying me ever since—was how entirely misinformed he was on pretty well everything he said about the Bushmen. He said it was not possible to retain the central Kalahari as a game reserve because the Bushmen were decimating the game with modern rifles, which they fired from trucks. Yet I knew from the game wardens and the evidence of my own eyes that this was not true; that game was plentiful after being nurtured by the Bushmen for centuries. He said they were no longer capable of practising their ancient arts of hunting and gathering, which was also untrue. He said the Bushmen leaders were making lots of money out of the dispute, driving around in smart cars and sending their children to private schools. This also turned out to be pure fiction.
	I mention this conversation because it seems inconceivable that President Mogae did not think he was telling the truth. So the conclusion must be that he is being very badly briefed by those around him, which is a pity because the Bushmen's treatment is doing the otherwise good reputation of his country no good at all.
	President Mogae made one other less obviously erroneous, more debatable point, which has been echoed in spades by the noble Baroness, Lady Tonge, the noble Lord, Lord Jones, and, I regret to say, the noble Lord, Lord St John of Bletso, tonight. This is that the Bushmen must be dragged into the joys of our 21st century, whether they like it or not. I have not time to deal with all the reasons why this policy is mistaken. Suffice it to say that it goes against all modern conventions and agreements on the treatment of indigenous people.
	I fear that the real cause of the Bushmen's plight is our old friend racism. The African herdsman looks down on the hunter gatherer. I know this is a strong accusation to make against the government of Botswana—and I make it with considerable sadness—but at this point somebody has to say it because it is the truth. I can but hope that President Mogae and his colleagues will reflect on it and, having done so, will allow the Bushmen to return to their ancient lands and chosen way of life, to the benefit of all concerned.

Lord Avebury: My Lords, when I went up to Balliol 61 years ago, my greatest friend there was Seretse Khama, as my noble friend Lord Jones has reminded me. He used to say that when he became chief he would invite me to stay with him. Some 20 years later, when the CPA proposed to send only two Members—one Labour, one Tory—to the independence celebrations, Seretse personally intervened and insisted that an invitation be extended to me as well.
	He was a great democratic leader of his people, following the ancestral tradition of the kgotla, a public consultation place and process, in which everyone could participate, predating our own ideas of community politics by centuries. Because of his legacy, Botswana is cited as a model for the rest of Africa. We have heard that from several noble Lords today.
	But things are not perfect. One local NGO has said that the Government have become insensitive to public opinion and that Parliament is now known for serving the interests of the ruling party and not of the people. The general state of democracy has deteriorated over the past decade, they say, with regard to the rule of law, corruption and general aggression on citizens. So perhaps I may, as a friend of Botswana, offer a few words of advice.
	First, following the noble Lord, Lord St John, I shall deal with the subject of corruption. The recent Botswana Technology Centre scandal and the allegations about the Department of Road Transport and Safety point to the need for the powers and resources of the Directorate on Corruption and Economic Crime to be strengthened, and for declarations of interest to be required from elected members and officials at every level of government. Freedom of information should be enshrined in law, and Botswana should have a timetabled strategy for ratifying the African convention against corruption, joining 11 other African states.
	Secondly, as the noble Lord, Lord St John, also mentioned, there is the issue of relations with Zimbabwe. Some 800,000 people fled Zimbabwe for Botswana between 1999 and 2004, but as he said, the Botswana authorities have refouled thousands of them back over the border to the tender mercies of Mugabe, contrary to international law. The Minister said in South Africa last week that a collapse in Zimbabwe would have strong negative neighbourhood effects, with instability spreading across borders, and yet Botswana, like South Africa, treats Zimbabweans as illegal economic migrants and turns a blind eye to the crisis.
	Thirdly, the government must uphold freedom of expression. Last July, Australian Professor Kenneth Good was kicked out of the University of Botswana and expelled for criticising government policies. The Zimbabwean journalist Roderick Mukumbira was given seven days' notice to leave the country for unspecified security reasons. The Committee to Protect Journalists said that his expulsion was linked to his reporting on sensitive subjects such as the eviction of the San people from their ancestral lands in the game reserve. The government have banned educational materials about indigenous people that were distributed to 40 other countries.
	That brings me to the point made by several other noble Lords: the treatment of the San people. Compulsory assimilation is not the answer. All over the world, the result of such policies has been deterioration in the quality of indigenous people's lives, through disease, alcoholism and loss of social cohesion. Clearly, the individual members of these peoples have the same rights as anyone else to the services provided by the state, as my noble friend Lady Tonge has said. If they decide that they want to continue the sustainable way of life that they have followed since time immemorial, however, they should have that right, too.
	The UN has been discussing the Draft Declaration on the Rights of Indigenous Peoples for the past 11 years, and a text is at last being submitted for approval to the UN Commission on Human Rights. That would provide an interim yardstick by which the policies of states might be assessed. Article 7 says that indigenous peoples and individuals have the right not to be subjected to forced assimilation or destruction of their culture. It goes on expressly to prohibit the deprivation of their integrity as distinct peoples, their cultural values or ethnic identities, dispossession of their lands and resources, forced population transfer, forced assimilation or integration and propaganda promoting or inciting racial discrimination.
	While I join my noble friend Lady Tonge in sending congratulations to Botswana on the approaching 40th anniversary of its independence, on its impressive economic gains, adherence to the letter of democracy and achievements in education and health, particularly in dealing with the scourge of AIDS, I urge the government of Botswana to root out corruption and to address the problems of the weak and vulnerable, whether they be the San, asylum seekers or dissenters from the conventional wisdom.

Lord Astor of Hever: My Lords, I also congratulate the noble Baroness, Lady Tonge, on securing this debate. Botswana is a beautiful country and close to my heart. I have travelled to it on many occasions, experiencing the warmth, determination and generosity of its people.
	As other noble Lords have highlighted, since independence in 1966, Botswana has gone from relative strength to strength in comparison with its African neighbours. Its population is among the continent's wealthiest, experiencing the fastest growth in income per person of any country in the world during the past 35 years.
	Botswana's president can be congratulated on his government's firm stand against corruption. As the noble Lord, Lord St John, said, this has led Transparency International to recognise Botswana as the least corrupt country in Africa. It also has one of the most business-friendly environments and a long tradition of lively and unimpeded public debate, with a constitution that provides for freedom of expression and a government who generally respect that right. Indeed, the country has offered sanctuary to refugees from South Africa, predominantly in the 1970s and 1980s, and, more recently, from Angola and Zimbabwe. I share the aspiration of the noble Lord, Lord St John, that Botswana should use its authority to influence the Zimbabwe regime.
	Botswana does have problems—most notably, until March 2004, it had the highest rate of HIV/AIDS, as several noble Lords have emphasised. Sadly, more than one in three adults is infected, or has developed full-blown AIDS. This scourge of Africa has led to a significant decline in life expectancy—just 36 years for men and 37 for women. The Botswana Government have taken commendable action, working, as the noble Lord, Lord St John, said, towards an AIDS-free Botswana by 2016. Around 50,000 HIV patients are treated in one of the most advanced programmes in Africa, with regular testing and free ARV drugs provided.
	The Prevention of Mother to Child Transmission programme has recorded a welcome reduction in HIV transmission. The problem is being addressed proactively as well as reactively, but I fear that the long-term effects will have serious negative ramifications for the development of the country. The working population has been significantly depleted, with vulnerable dependants, such as children, the elderly and the ill left to fend for themselves with little, if any, means of earning income. What long-term predictions have Her Majesty's Government made of how the increasing number of dependants will affect Botswana's development?
	AIDS orphans and children are a particular concern, especially now that the president is reintroducing school fees. This is claimed to be part of a bigger plan to recover costs for services that have increased as the number of trained, active workers has rapidly declined due to HIV. AIDS orphans, pregnant girls and adolescent mothers are excluded from what has been considered a good education system. These fees will affect 170,000 children in state secondary schools; this could force some children out of education, leading to a negative cycle of declining community skills, resources and development. Does the Minister agree with the views of the UN special rapporteur that this policy needs to be reconsidered? What discussions have Her Majesty's Government had with the Botswana Government on this issue?
	The noble Baroness, Lady Tonge, spoke about the San bushmen, an issue that has been described as a blot on Botswana's reputation for tolerance. Serious allegations have been made by Survival International. On one side of the argument we had the noble Baroness, Lady Tonge, and the noble Lord, Lord St John; on the other side my noble friend Lord Pearson and the noble Lord, Lord Avebury. We on these Benches share the international concern on this issue. What assessment have the Government made of Survival International's claims? Do they plan to raise them with the Botswana authorities?
	I understand that DfID's priority is to low-income countries. Botswana's success means that its status is one of middle income. Her Majesty's Government are continuing to withdraw from their traditional bilateral assistance on this basis. I fear that the ramifications of AIDS on the human resources there could stifle development. I hope that the Minister can reassure the House that these considerations are taken into account when targeting aid.

Lord Triesman: My Lords, I join other noble Lords in thanking the noble Baroness, Lady Tonge, for initiating this debate, and I thank all noble Lords who have participated. I share with her and the noble Lord, Lord Astor of Hever, the view that Botswana is plainly a fascinating country.
	At independence in 1966, it was one of the 20 poorest countries in the world. Today, it is the richest non-oil producing country in Africa. It is one of the notable success stories of the poorest continent on Earth. However, major obstacles, many of which affect the whole region, remain to be negotiated: debilitating rates of HIV infection and an economy that needs to diversify to guarantee long-term growth. Other changes are needed too. The noble Lord, Lord Avebury, suggested ways of strengthening democratic practice, and I agree with him, but one should look at the speed with which change has been achieved in that country in a very few years and think about how long it has taken to arrive at a Freedom of Information Act in the United Kingdom.
	The noble Lord, Lord Astor, asked whether we are discussing various issues of policy. We are, and I can assure him that we will continue to do so. The International Development Select Committee of the other place was in Botswana discussing many of these issues just last week.
	Botswana's transformation since 1966 has been astonishing. The noble Baroness, Lady Tonge, and the noble Lord, Lord Jones of Cheltenham, reminded us of the peaceful route that has been followed. At independence, the economy was based almost purely on agriculture, while aid funded virtually all government expenditure. As has been said, the catalyst for change above ground was the discovery in 1967 of rich seams of diamonds beneath it. Unlike in some other African countries, diamond revenues have been invested in infrastructure, education and health. Foreign investment was welcomed, while private businesses have been allowed to blossom.
	Mining operations fundamentally transformed Botswana into a country that has consistently displayed one of the highest rates of economic growth in the world. Over the past 40 years, Botswana has been the fastest growing economy in the world, averaging just over 5 per cent GDP growth per annum. But this success should not be pinned on diamonds alone. Other African countries have found themselves endowed with diamonds and other mineral riches, yet they have imploded. Botswana's recipe for economic achievement has been simple: peace, prudent policies, low taxation and judicious spending. Botswana has maintained a balanced budget throughout most of its post-colonial history and has demonstrated a willingness to cut spending when revenue has declined. To this must be added the political dividend that the country's wealth and homogeneous nature have brought. Botswana has witnessed 40 years of internal peace and stability. It is the continent's longest-running, continuous multi-party democracy. In 2005, as a number of noble Lords have mentioned, Transparency International rated Botswana as the least corrupt country in Africa. I do not see that it is slipping down that scale. The noble Lord, Lord Giddens, emphasised this stability and the country's basis in a solid macro-economic and political system.
	However, not everything in Botswana's garden is rosy. There are conflicting opinions about the strength of the economy. The Government of Botswana are aware that the economy is too narrowly based on diamonds—a finite resource. I suppose that one could say that diamonds are not for ever in anybody's case. The Government are addressing this issue and have been actively seeking to diversify through local and, principally, foreign direct investment, but the fruits of the investment are yet to be realised on the whole. The noble Lord, Lord Giddens, quite rightly raised diversification. I accept that advice from external sources is certainly important, but the size of the public sector probably squeezes private sector development. English language may well make IT development a possibility. That is well worth exploring.
	It is also right, as the noble Lord, Lord St John of Bletso, and others said, that Zimbabwe is both an economic issue and a general problem in the region, not least because that country is now suffering from four-figure annual inflation which is going up by the day. The troubles of Zimbabwe have a profound impact on all its neighbours. Zimbabwe is difficult to influence as we all know. I make the point to the noble Lord, Lord Astor, that the more sensible nations in the area may have the least influence.
	Illegal immigration is placing an increasing strain on government services in Botswana and South Africa, and there are significant difficulties, which I saw for myself last week. There is a crisis for the neighbours; they cannot simply absorb what I believe may come to be more than 6 million refugees from the meltdown of the Zimbabwean economy. We in London SW1 make these points about the duties of nations which are themselves struggling to feed parts of their populations that are hampered by disease, food shortages and other problems. I think that we need to understand some of the difficulties that they have to cope with.
	The country's landlocked status and dependence on South Africa for almost all imports does not help economic diversification. The noble Baroness, Lady Tonge, is right, as other noble Lords are, in pointing out that unemployment remains a concern, with the national rate estimated at 24 per cent, climbing to about 40 per cent among younger people. Although classed as a middle income country, wealth distribution is skewed: poverty, while declining, keeps some 30 per cent of the population living below the poverty line. I think the noble Lord, Lord Giddens, mentioned 40 per cent, but we think that the figure is 30 per cent.

Lord Giddens: My Lords, I think that the figure refers to households rather than individuals. The rate is a lot higher for individuals than it is for households.

Lord Triesman: My Lords, I shall go back to the basic research to ascertain the facts for certain—but the figure is big enough.
	Debswana, the diamond mining joint venture between the Government of Botswana and De Beers, is a key player in the national economy, realising about 80 per cent of the country's export earnings, 40 per cent of GDP and 50 per cent of government revenue. This wealth has been distributed to the population through the provision of social services such as education and healthcare and investment in infrastructure.
	There is a significant challenge to the government and the nation, and it is HIV/AIDS, which a number of noble Lords have mentioned. I do not know what the true cost to the economy is, but it is obviously substantial. UNAIDS reports that some 37 per cent of the sexually active adult population are infected. However, in recent months, the Government of Botswana have produced a figure of 17 per cent, based on their own impact survey of the total population, from cradle to grave. What is certain is that there is a massive infection and the government are working hard to bear down on it. Some 90 per cent of the budget for HIV/AIDS is met from the government's own resources, with the donor community making up the 10 per cent balance. Some 58,000 Botswanans receive anti-retroviral treatment completely free of charge. That equates to over half of the 110,000 that UNICEF estimates need such therapy. By 2008, the Botswana Government expect to provide treatment to all Botswanans who require it.
	These figures are unquestionably difficult, by any standards. There are differences between the figures for the sexes: the female incidence rate is 1.7 times the male rate. The programmes required for prevention of mother-to-child transmission are fundamental, which is why the government are providing drugs to 73 per cent of pregnant HIV-positive women. The number of people who underwent routine HIV testing during 2005 increased, too.
	DfID is supporting a £7.65 million regional HIV/AIDS programme through the Southern African Development Community. Key elements of the programme are the social marketing of male and female condoms; prevention activities in high transmission cross-border sites; support for national AIDS councils; and promotion of behaviour change. Noble Lords wanted to know what we are doing, and that is among the things that we are doing. It is certainly true that President Mogae has led a public campaign which is itself of considerable importance and contrasts with some of the other programmes in the region.
	The issues of environment are also important. There is a DfID desertification team which has been established to address Africa-wide issues of desertification. It is true to say that that needs to work with some urgency, given the fragility referred to by the noble Lords, Lord Chidgey and Lord St John, which is plainly to be seen.
	I turn quickly to the issue of the San. The issue of the San of the Central Kalahari Game Reserve attracts a good deal of attention here. The British High Commission in Botswana regularly discusses the San issue with the Government of Botswana and interested parties. In recent years they have made several visits to the Central Kalahari Game Reserve and relocation areas such as the New Kade, the latest being in June 2005. Our High Commissioner to Botswana has raised the issue on several occasions since his arrival in October 2005, and we place it high on our agenda.
	We look to the Government of Botswana to address effectively the social and cultural differences between the different communities. However, I say to the noble Lord, Lord Pearson, as this issue came up recently in a Question, that there is no doubt that the Botswana Government, dealing with a country overall the size of France and an area of natural reserve the size of Switzerland, are bound to try to respond to some of the demands of the people of that country for proper levels of education for their children and proper opportunities. Those things may not be desired by every one of the San population, but there is no question but that a great many people want, and aspire to, those things for the future, and for their families. We are following the legal case closely, but we understand those aspirations, and we do not believe or accept that clearing sites in order to mine for diamonds plays any part in these programmes. There is no sound evidence of that whatever.

Lord Pearson of Rannoch: My Lords, I never said it did.

Lord Triesman: My Lords, I am sorry if I have misunderstood the point. I apologise to the noble Lord, Lord Pearson, if I have done so.
	That brings me to my conclusion. There has been a great change in Botswana over a short time, and great strides have been made. Natural resources have been translated into firm foundations for real growth, fuelled by stable and democratic governments. Human capital remains the key ingredient to successful growth. The government need to focus their efforts on fighting the HIV/AIDS epidemic, eradicating rural poverty and targeting unemployment, but Botswana should be applauded for the progress the country continues to make and the example that is set for the rest of Africa. The noble Baroness, Lady Tonge, is right to ask for a clear acknowledgement of our support for that. We sometimes make the point in your Lordships' House that Africa is a continent, not a country. It varies greatly from country to country: some are blighted by war, poverty or disease, while others are striding forward to a better life. Botswana is among the latter.

National Lottery Bill

House again in Committee.

Lord Clement-Jones: moved Amendment No. 14:
	After Clause 11, insert the following new clause—
	"DISTRIBUTING BODIES: REPORTING
	After section 25E of the National Lottery etc. Act 1993 (c. 39) (as inserted by section 11 of this Act) insert—
	"25F Distribution of funds: reporting
	(1) Distributing bodies, as set out in section 23, shall make a report to the Secretary of State no later than 30 days after the end of each financial year about how decisions on the awards made during that year have been reached.
	(2) Matters which shall be dealt with in the report under subsection (1) include—
	(a) the independence of funding decisions;
	(b) the principles applied to maintain the distinction between core government expenditure and lottery funding; and
	(c) the proportion of funding that has been allocated to bodies (other than public bodies or local authorities) whose activities are carried out not for profit.
	(3) The Secretary of State shall lay a copy of each report received by him under this section before both Houses of Parliament.""

Lord Clement-Jones: During the stages of the Bill in the other place, the Big Lottery Fund gave a commitment to report on how it has upheld the additionality principle. That commitment was reciprocated by the other lottery distributors, which agreed to determine a policy on additionality and make it publicly available, most likely through their annual reports. While we on these Benches welcome those commitments, we believe that they must be enshrined on the face of the Bill if they are to be meaningful and lasting. This issue is supported in both the arts and voluntary sectors. The Minister may well have seen a statement made by those sectors today on their support for this amendment.
	The amendment requires all lottery distributors to report on the nature and destination of their funding on an annual basis. In addition to increasing the transparency and accountability of lottery distributors, this would address the two fundamental issues of additionality and the proportionate funding flowing to the voluntary and community sector. I acknowledge the commitments that have already been made in these areas but placing this requirement on the face of the Bill would ensure that they are upheld in the long term irrespective of the future leadership and priorities of lottery distributors. If the Government and the distributors are genuinely committed to reporting on how they have allocated lottery funding, there is no reason why they should resist this amendment.
	I was particularly interested to read how the Minister, Mr Caborn, responded to this amendment, which is very similar in form to that tabled by my honourable friend Mr Foster in the other place. He gave it an extremely sympathetic hearing. I very much hope that the Minister will follow that splendid precedent and give it a similar fair wind. Rather than going off into the realms of trying to define "additionality"—this is the important thing about it—it tries to get to the core of reporting and distinguish in a practical way between core funding and funding which is properly being spent on the voluntary sector. Indeed, it reinforces some of the commitments that have been made about 60 to 70 per cent of the Big Lottery Fund's money being spent on the voluntary sector. I very much hope that it will be seen as a practical way of addressing this issue. I think of the hunting of the snark when trying to define "additionality". However, this is not an attempt to hunt the snark; I hope that it is a wholly more practical solution. I beg to move.

Viscount Astor: I support the amendment moved by the noble Lord, Lord Clement-Jones. If we accept the principle of the Minister's arguments on the previous amendment that we discussed before the dinner break—which I do not entirely, of course—he has to accept this one; he has no choice because it is the argument that he made. The Minister in another place has already given a commitment that the distributing bodies will report. We have heard from the various distributing bodies that they will report. That is all well and good but we want that in the Bill. I see no reason why it should not be included. We are not asking them to report in any particular way. If there is anything in the amendment to which the Minister objects, I am sure that the noble Lord, Lord Clement-Jones, will amend it on Report to satisfy any drafting concerns.
	The Minister has an opportunity to answer the questions that I put to him at the conclusion of the previous debate about how the distributing bodies will report on additionality and what guidelines will be given by the department or the Secretary of State on how they should do that. Or, will no guidelines be given? Are they expected to do that on their own? It would be helpful to be told that. As the Secretary of State has powers of prescription, will he prescribe that they should report? It would be interesting to know that.
	The Government have moved a long way in agreeing that the distributing bodies should report. However, they have to move a little further and include the measure in the Bill, either by incorporating the wording of this amendment or using some other means to do so.

Lord Davies of Oldham: The Government are very supportive of the intentions behind this amendment and agree with much of the sentiment that has been expressed. I am delighted, therefore, to confirm the expectations of the noble Lord, Lord Clement-Jones, and the noble Viscount, Lord Astor.
	We agree that decisions on which projects to fund should be for distributors. We agree that distributors should follow the principle of additionality. As already discussed, we support the undertaking of the Big Lottery Fund that 60 to 70 per cent of its funding each year will go to voluntary and community sector organisations. We have already mentioned our agreement with distributors that they should report annually on additionality. To ensure transparency on additionality while respecting the independence of lottery distributors and allowing the necessary flexibility, I am pleased to tell the Committee that we have now agreed some further details with the UK and England distributors. First, they will adopt a common framework for reporting on the principle of additionality, which will comprise each lottery distributing body's own policy on additionality, how it informs the design of their funding programmes, and how it works at the grant-giving level.
	Secondly, they will adopt a common interpretation of the principle of additionality. I can accept the interpretation of the principle of additionality, whereas noble Lords will have noticed I resisted the notion that we could translate that into the precision of law. The common interpretation will be:
	"Lottery funding is distinct from Government expenditure. Where appropriate it complements Government and other programmes, policies and funding".
	I hope that definition satisfies the Committee. Thirdly, the distributors have confirmed that annual reports will be the main vehicle for reporting on additionality. The Government feel that those additional commitments on the part of distributors should meet the concerns expressed by noble Lords and others about transparency.
	The Government do not believe that the amendment is appropriate and there are a number of reasons why we cannot support it. First, there is no need to require in the legislation that distributors report on how their decisions are independent of government. Distributors have always had that policy and they have had financial directions setting out the high level policy framework and financial propriety. That was introduced under the previous government and was continued by the current one. Beyond that, decisions on lottery funding are for distributors themselves to make. Secondly, the distributors have of their own volition agreed to adopt a common framework and interpretation of the principle and to report annually in this area, as I have already set out. It is bad regulatory practice to increase the volume of legislation on the statute book by putting into legislation something that can be achieved by other means such as, in this case, a voluntary agreement. Noble Lords will recognise the strength of that position.

Viscount Astor: I am afraid that I cannot resist it. The noble Lord said that he is putting in place a voluntary agreement. As with so many arguments that he has used on prescribed powers, does he not think that a backstop power would be useful in this case as well?

Lord Davies of Oldham: The noble Viscount obviously had a good and reflective dinner, and he has had the chance to brush up on points on which to cause me some embarrassment. In this case the answer is no, because we are going to achieve our objectives by clearly expressed agreement, which I am sure is applauded right across the Committee.
	The wording,
	"the distinction between core government expenditure and lottery funding",
	does not allow the flexibility for changes in ideas over time on what the Government should be funding or allow a complementary approach as set out in the framework agreed by distributors. Finally, the amendment would require all lottery distributors to say how much funding they have given to voluntary and community sector bodies. The Big Lottery Fund, as we have already discussed, gave an undertaking that 60 per cent to 70 per cent of its funding will go to that sector. That reflects the fact that one of its constituent bodies, the Community Fund, was originally set up to fund voluntary and community sector organisations. The Big Lottery Fund wants to ensure that such organisations receive at least as much money in future as they do now. Other lottery distributors may of course also fund the voluntary and community sector, but it is only the Big Lottery Fund that has given a specific undertaking on percentages.
	We are not therefore convinced of the need for all distributors to report on this matter any more than they report on the proportion of funding allocated to any other sector or type of organisation. The Government believe that our approach is the best way of dealing with these issues. Our proposals for reporting will be transparent and will impose minimum bureaucratic burdens—a concept that I know will commend itself to both Opposition Front Benches—yet will allow for appropriate parliamentary and public debate should that be appropriate. I accept the principles behind the amendment and the spirit in which they have been presented, but I hope that the noble Lord will recognise that I cannot accept the amendment, although I accept the substance of his argument.

Lord Clement-Jones: Well, I do not know whether the Minister is a member of the Magic Circle, but I felt that that was one of those "Now you see it, now you don't" ministerial answers. On the one hand he was saying, "Yes, we've got all the mechanisms set up. We have agreed that the distributors should report in this way and we have a common framework and a common interpretation. Yup, everything is in line". I was half-expecting the Minister to add, "Yes, there is no problem in enshrining that in primary legislation because the practical facts are straightforward and everything is in place".
	Of course the sting was in the tail of his reply. His reasons for not enshrining this matter in primary legislation were extremely thin, compared with the concerns of the voluntary and community sector, which is extremely anxious to see that it is included. In fact, as the Minister knows full well, enshrining this in primary legislation would to a huge extent head off the steam behind the additionality argument. However, he lamely said, "We are not going to put it in legislation, because you do not put in legislation what can be achieved by voluntary means". Frankly, half of the Government's legislation could be scrapped on the basis of saying, "We will legislate unless you do this voluntarily".
	The Minister said that it would not allow for flexibility—but that is all in the drafting. If the Minister feels that it is not sufficiently flexible, I am sure that forms of words could be found; but he did not provide an example.
	His third reason was that there was no commonality in every precise respect between all the lottery distributors. But that is not required. This amendment would not put them in a straitjacket as regards their reporting. There is no requirement that all the other lottery distributors should give, say, 60 per cent of their funding to the voluntary sector.
	The Minister has not made much of a case against reflecting in primary legislation what will clearly be the practice. Quite the contrary. The Minister has demonstrated how that can happen in practice, and he is clear that enshrining that in legislation would not be a considerable problem. In fact it would be entirely possible—

Lord Davies of Oldham: Perhaps the noble Lord will allow me to intervene. Paragraph (c) of subsection (2) of the amendment makes the same requirement on all distributors—that they should report on,
	"the proportion of funding that has been allocated to bodies (other than public bodies or local authorities) whose activities are carried out not for profit".
	That is a requirement on all sectors. All I am indicating is that that is not entirely appropriate across all sectors.

Lord Clement-Jones: That is not a straitjacket. It does not say, moreover, that they shall ensure, like the Big Lottery Fund, that they give not less than 60 per cent of their funding to the voluntary community sector; it is simply a matter of fact. I must confess that I am somewhat baffled by that objection, because I cannot see that the provision of information is in any sense a constraint on any of those lottery distributors, other than the Big Lottery Fund, which we know has made a commitment and is able to report.
	The Minister's objections are somewhat extraordinary, particularly since he produced from one cuff, in a sense, part of a trick, while making it clear that in practice all the necessary ingredients of that reporting structure had been, or were being, put in place. That is welcome. So the next step onto which I hope to take the Minister will be at Report stage. I will read the Minister's words carefully, but I can guarantee that I shall take him carefully through his words tonight and urge him to take the next logical step—to enshrine this reporting requirement in the legislation. Meanwhile, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Clause 12 agreed to.

Viscount Astor: moved Amendment No. 15:
	After Clause 12, insert the following new clause—
	"APPORTIONMENT OF MONEY IN DISTRIBUTION FUND
	In section 22 of the National Lottery etc. Act 1993 (c. 39) (apportionment of money in Distribution Fund) for subsection (3) substitute—
	"(3) Of the balance—
	(a) 25 per cent shall be allocated for expenditure on or connected with the arts,
	(b) 25 per cent shall be allocated for expenditure on or connected with sport,
	(c) 25 per cent shall be allocated for expenditure on or connected with the national heritage,
	(d) 25 per cent shall be allocated for charitable expenditure,
	including, in each case, for establishing or contributing to endowments in connection with such expenditure.""

Viscount Astor: In moving Amendment No. 15, I shall speak to a whole raft of amendments that are consequential on it—most of which I do not understand, but I shall speak to the first one.
	In an earlier debate when talking about the Big Lottery Fund, the noble Lord, Lord Clement-Jones, said that it was an apple cart that he did not want to overturn. I think that the apple cart is particularly overloaded and therefore I find it almost irresistible not to try to overturn it—there are sound reasons for doing so. Perhaps I may take Members of the Committee back to the start of the National Lottery.
	Noble Lords will remember that there were originally five bodies—four dealing with the arts, sport, heritage and charities, plus the Millennium Commission. Now we have no Millennium Commission. If we managed to put the lottery back as it was, which I think would be far simpler and easier—I recognise that I may be a rather lone voice in this argument this evening; nevertheless, I intend to press it—that would have a significant effect on the three distributing bodies. For example, under the current estimated funding of good causes, the Big Lottery Fund will get about £690 million a year, heritage will get £230 million, and sports and the arts will receive about the same. Under my amendment, charities would get £345 million and heritage, sports and the arts would also get £345 million. So heritage, sports and the arts would get substantially increased funding, as they do now—more than £100 million more. I think that that would be a good thing. It would put the lottery back to what it was.
	We know that the Government changed the lottery and brought in the Community Fund and the New Opportunities Fund but that, in effect, they did not work as they should have done. As a result, the Government have come forward with the Big Lottery Fund. We have heard a lot about that. The biggest problem is that, because it is so large, the Government feel that they will have to have additional powers to enable them to prescribe very much what it does and how it acts. If we had the four original distributing bodies, none of that would be necessary. We would not need the debates on additionality. All of that would probably go because each of the four bodies would be narrowly focused and therefore those issues would not exist, which would be for the best.
	I accept that my amendment would entirely change the Government's policy on the lottery and I accept that the Minister will be robust in his defence of the Big Lottery Fund. That is fine, but I cannot let this issue go by without saying that we think that the Government have got it fundamentally wrong. It has enabled all these issues of additionality to come up, which they should not have done, and that has been dangerous for the lottery. On average, there has been a very small rise in the total amount that distributing bodies have been able to give away over the past five or six years. The lottery was brought into disrepute—that might be too harsh a word, but the public were put off certain sections of it. It is only now that turnover is beginning to increase. That was not Camelot's fault; sadly, it was due to the public's perception of how the lottery was being managed. If one part of the distributing bodies does something, it affects all the other parts.
	My amendments would put back the lottery as it was. I know that the Minister will not accept them but I should like him to accept the principle. Perhaps I may turn to one part of that. If the amendments were accepted, charities would receive about £350 million a year because they would get 25 per cent of the funding—more than they have ever had before. The largest amount that they received under the Millennium Commission was 20 per cent. That would be a substantial increase. Can the noble Lord give me a commitment that under the Big Lottery Fund charities will receive an equivalent amount of funding? I shall be interested to hear his reply. I beg to move.

Viscount Eccles: I support my noble friend Lord Astor. I think that we may have got some things out of proportion. If it were not for the creation of the Big Lottery Fund, the Wellcome Foundation would be the largest distributor of funds in the country—it handled more than £500 million last year. It seems that the big missing link since 1997 has been that, instead of building the partnership with the big distributing charities, the Government have gone down the line of saying, "We know what to do with donor money better than the big distributing charities". Little bit by little bit, they have turned those charities off; they are not comfortable with working with the lottery. When you add up all the money distributed by grant-making charities—the largest, as I say, being the Wellcome Foundation before the creation of the Big Lottery Fund—it is a formidable sum.
	If we were to follow my noble friend's amendment, we would be going back to a position in which there was no government distribution fund that was the largest in the country. While we think about that, it amazes me that nobody, at any point in these debates, mentioned that the Chancellor is already taking 12 per cent out of the pot. I support the amendment.

Lord Brooke of Sutton Mandeville: I have watched the Minister with the keenest interest throughout the proceedings today. The noble Lord, Lord Clement-Jones—who I shall go back to calling by his proper name, rather than the one I invented in our last session—has referred to the manner in which the Minister defends himself. He avoids a single false stroke; there is not the possibility of a catch anywhere. It is a totally defensive innings, playing for a draw on the last day of the test. I use the analogy because I know the Minister's enthusiasms. We are straight back to Trevor Bailey and Willie Watson in 1953. It now becomes a matter of curiosity for the balance of a Committee stage to see whether we can elicit a false stroke from the Minister at any point, or whether we will have a dead bat throughout.
	It is in absolute contrast to the performance of the noble and learned Lord the Lord Chancellor during the Terrorism Bill. Each time, when he tried to argue the Opposition off their latest amendment, he would warmly congratulate them on everything they had done to improve the Bill up to that moment. Thus he was retrospectively hitting his wicket, because he had previously spent the whole of that amendment explaining why it was wrong and the Government were right. But that is by the by. I admire the style with which the Minister does it.
	Like my noble friend Lord Astor, I go back to 1993, when we put into the then Bill five allocations of 20 per cent, with reasonable confidence that, to coin a phrase, nobody would wish to upset the applecart by changing their own percentage upwards, for fear that somebody else might change it downwards. Those five allocations of 20 per cent each lasted right through to the 1997 general election.
	As I recall, however, we gave an assurance during the passage of the Bill that we would be entirely happy to have a one-day debate, if necessary on an annual basis, to give Parliament the opportunity of discussing whether to change the percentages. My recollection is that we put in secondary legislation so that, if that were to be the case, we could then bring in a prompt reallocation of the amounts. In the event, that never occurred—perhaps because people did not want to upset the applecart.
	My enthusiasm for what my noble friend is doing is that he is taking us back to the schema of 1993–97, and giving Parliament the opportunity to express a view on whether the allocations are right. The present Government did something quite different in 1997. They did not throw it open to a general debate in Parliament; they went out with a consultation exercise to which 600 people responded, 540 of whom—or 90 per cent—were producer interests who were extremely enthusiastic about the distribution being broadened to include them, when they had previously not been. But that is by the by; it is yesterday's battle.
	My one bone of contention with my noble friend is on moving to 25 per cent each. I should say that we did specifically say that the Millennium Commission, whose 20 per cent we recognise, was going to drop out at some stage once the millennium had been reached. That gave us a particular opportunity to cope with another issue the opposition raised constantly during the passage of the Bill: that the charities figure might be wrong, and that the 20 per cent that charities were going to get might be a reduction on what they would have received if the lottery Bill had not been enacted.
	At that stage we had only one other working example in any way analogous to ourselves. That was the Irish lottery, which had existed for a year or 18 months, and was not a particularly good analogy. But, as we said, we had the flexibility when the Millennium Commission went, to increase the amount going to charities if it was proven that they should receive more. There was not an absolute certainty that we would end up with the particular percentages that my noble friend has chosen but I salute him for having given Parliament the opportunity to have this debate and to hear what the Minister has to say.

Lord Davies of Oldham: The noble Lord, Lord Brooke, could have chosen a happier day than this to berate me for trying to play with a dead bat, given that that is exactly what the England cricket team could have done with in India over the past 24 hours.
	Far from playing with a dead bat, I am in the happy position of having, not a hostile ball bowled at me, but constructive suggestions from the Opposition on how we can improve the Bill. I am taking those on board as best I can with, now and again, the odd reservation about accepting the amendments. The Committee will recognise that, for example, I accepted the elements of the previous amendment in principle and am glad to say that we are acting in concord with it. I do not think that that is a dead-bat approach to opponents, but a constructive enterprise that we are all involved in together to improve the legislation and the working of the National Lottery in the United Kingdom.
	The noble Viscount, Lord Astor, with his characteristic modesty, said that he knew what Amendments Nos. 15 and 16 were about but that all the rest were incomprehensible. They are not incomprehensible; they all do the same thing. They seek to change the Big Lottery Fund to the Charitable Lottery Fund and then abolish the health, education and environment good causes. That is what all the amendments are for. The noble Viscount, quite rightly, concentrated on the desirability of that outcome. I will resist that, as he rightly predicted. I think he said he was about upsetting the applecart. I was trying to think of a circumstance in which it could ever be beneficial in any exercise at all to upset the annual apple cart. I cannot think of one, but on this occasion I will assume that the noble Viscount is indicating that he does not expect me to regard his amendment as wholly beneficial to the Bill, and, indeed, I do not. What is involved here and in broad principle is a wholly retrograde step of going back to 1998.
	I congratulate that administration, of which the noble Viscount was a distinguished feature. I respect that administration. It created the National Lottery. I am sure that the noble Lord will also recognise that we have done a great deal in this Government to re-energise the lottery and bring it closer to people. The noble Viscount should recognise that Parliament voted to add health, education and environment to the existing lottery good causes in 1998—a Parliament, I might say, which had substantial backing from the community. That reflected the fact that health, education and environment are as important to people's lives as sport, heritage and the arts.
	We have public opinion behind us. When we asked in a MORI poll what the public wanted as the two or three most important things for the lottery to provide, they said health and education—69 per cent quoted health and 55 per cent quoted education. That will fit entirely with the experience of Members of the Committee when they talk to our fellow citizens about just how much they are rated by the public as goods that they hope will be delivered—knowing full well that there is always a limit on what resources can be made available through government and eager, as they have always been through charitable activities, for them to be advanced through other sources.
	After all, what is a feature of our health provision in this country and, to a lesser degree, our education provision, if it is not resources coming from bases other than government? Indeed, the good causes that we have promoted have produced some absolutely excellent projects. Across the UK, 350 centres have been funded enabling people to learn about healthy living and eating. More than 4,500 pieces of cancer-fighting and life-saving health equipment have been purchased which would otherwise have taken years of fundraising to secure and are additional to what, even in the greatly enhanced health provision under this Government, would have been provided under government resources.
	Also, 30,000 World War II veterans, widows or carers have visited battlefields where they or their loved ones saw action or fell. A network of computers has been created throughout all of our 4,000 public libraries. The Committee will recognise that those features are the product of the lottery. They would not have come from core government funding, however enterprising and benevolent the Government prove to be, as they do on most occasions. Those are just a few examples of the benefits of the lottery.

Lord Brooke of Sutton Mandeville: First, I appreciate the Minister giving way. Secondly, I appreciate the examples that he gives. However, the 4,000 computers that have been added to public libraries—which, from what he said, I am happy to believe come from additional expenditure—make it the more curious that what libraries have given up buying is books, which, in the normal practice of libraries, is what one would have expected them to be buying. In fact, they are buying all sorts of other technology, over and above the additional purchases to which the Minister has just referred.

Lord Davies of Oldham: I am not altogether sure that that case is established. In this day and age, even if the lottery had not been developed and we had been allocating resources through the Department for Culture, Media and Sport to libraries, there is no doubt that there would have been a shift in the priority of library acquisition. Whereas the noble Lord and I have an affinity for books, which may be an important part of the information, entertainment and joy that we receive, there is a generation that gets at least as sound information and an enormous amount of pleasure through communication other than books, which they expect—and have the right to expect—libraries to provide. So that is not an entirely fair criticism.
	We have the right to defend the benefits that the health, education and environment good causes have provided. That concept is here to stay. There is no doubt that that is what the public expects to be delivered. Accordingly, I accept what the noble Lord says about the virtues of specific percentages, to return to the categories that he identified, but we cannot keep things forever as they were in 1998, still less in 1993. The lottery cannot stand still. There are new expectations, new profiles of public demand and new pressures on us. Although the noble Lord wants to take a two-decade step backwards, I am more interested in taking a step forward into the next decade. Within the framework of the good causes, that is exactly what we are doing. I am fulfilling what the noble Lord predicted: I resist the amendment not on detail but on principle.
	I have one word to say to the noble Viscount, Lord Eccles; I hear what he says about the effect on charities of the development of good causes, but it is somewhat surprising that he can state so assertively that charities dislike having to work under this new framework. I have no evidence of that. He is right that the Wellcome Foundation is by far our most significant allocator of resources in the private sector, but I have no evidence that it finds the present developments inimical to its purpose and is unwilling to work alongside the lottery distributors. I may be singularly ill informed, but it would be surprising if a body as significant as the Wellcome Foundation had not been in contact with my department, which is concerned with these issues, saying, "Up with this we will not put", or that it was extremely uncomfortable in various areas because of what is being done under the Big Lottery Fund. All I can say is that I have no evidence of that and, until I get those representations, I prefer to rest on the assumption that the Wellcome Foundation and other charities are working congruently with what we are providing elsewhere so that they may fulfil their purposes, and that this is all to the benefit of the community we serve.

Lord Brooke of Sutton Mandeville: I return to my analogy of the Minister batting out the last day of a test match. It is just possible that we have got through his guard in the course of this exchange, as he has explained to us why it is totally appropriate not only that the additional money which the Big Lottery Fund is spending on computers for libraries should be so spent, but that all the money that used to be spent on books should be spent on new technology. It leads one to the novel proposition that perhaps the Big Lottery Fund ought now to start buying books for libraries on the ground that that will quite clearly be additional to any current government expenditure.

Lord Davies of Oldham: If the noble Lord will forgive me, as I understand it, there is a statutory obligation on local authorities to buy books for libraries. In fact, the facilities mentioned by the noble Lord are in addition to what I believe he and I might just accept at this stage is core funding.

Viscount Astor: I am grateful for the Minister's reply, which was not unexpected. I have two quick points to make. First, I entirely accept what my noble friend Lord Brooke of Sutton Mandeville said about there being an opportunity, when the Millennium Commission came to an end, to reconsider the amounts that would go to the distributing bodies. None of the examples that the Minister gave about the awards given out could not be made by the four bodies suggested in my amendment. They could all be made, so it would not be true to say that they could not.
	Another criticism was that this was going back. It is not; it is doing something entirely new—making four bodies, which has never been done before because there was always the Millennium Commission. It would solve most of the problems of additionality and prescription, and it would make life much easier. I recognise that I do not have as much support around the Committee as I would hope. Nevertheless, I think that my amendment is valid, and I wish to test the opinion of the Committee.

On Question, Whether the said amendment (No. 15) shall be agreed to?
	Their Lordships divided: Contents, 19; Not-Contents, 46.

Resolved in the negative, and amendment disagreed to accordingly.
	Clause 13 [Establishment]:

Viscount Eccles: moved Amendment No. 16:
	Page 7, line 25, leave out "Big" and insert "Charitable"

Viscount Eccles: I thought it more appropriate to wait to speak to this amendment because it relates to a rather different subject from Amendment No. 15. It does not attempt to challenge the 50 per cent—although I dislike it, having supported my noble friend's previous amendment.
	In passing—and before I launch into my reason for wanting to change the name of "Big"—I hope the Minister is not suggesting in his analysis of "consultation" that the Heritage Lottery Fund, the Art Fund and the Sports Fund make no contribution either to health or education.
	The Big Lottery Fund has been operating since June 2004, and it is not clear how it got its name. Was it the invention of a senior civil servant on his way home, or the expensive creation of some consultant? Either way, it is an unhappy choice, with shades of James Bond and Big Brother; Mr. Big rules OK? On Second Reading, the Minister said that it was wrong to read proposed new Section 36D as an invitation to "Big" to tell its smaller distributor confederates how to behave. How does he plan to control this possibility? Four chief executives enter the room for a monthly meeting: one is Mr. Big, a 50 per cent man, and the others are each 16.66 per cent. In other circumstances, this situation would lead to indictable discrimination. Interpreting government policy as people will, it is asking too much of human nature to expect that "Big" will not accept the Secretary of State's approved strategy, which is that "Big" should have a leadership role, clearly expressed in the decision document of July 2003, at paragraphs 3.7 to 3.23. In three pages, it is made absolutely clear that "Big" is to be the leader.
	We should change the unincorporated name of "Big"—it is not too late, as it does not exist as a legal entity—to "Charitable". That would return it to its roots and be no bar to its grant giving, given the clarification intended by Clause 19. A fund with "Charitable" in its name is likely to be far less bossy than "Big". I beg to move.

Lord Davies of Oldham: My Lords, I am grateful to the noble Viscount for the way in which he moved his amendment. I resile from any imputation that the arts, national heritage and sports have no contribution to make to health, education and the environment. Of course they have. All these divisions have an arbitrary quality to them, but he will realise that projects under the Big Lottery Fund do not fit easily or automatically with the other three categories.
	The noble Viscount indicated that it is not just a question of changing the name—there is a feeling that the fund should focus more on the voluntary and community sector, which is why he wants to change the name to the "Charitable Lottery Fund". Well, we just had that discussion, and I indicated why I sought to defend the arrangements that have obtained since the changes in the lottery in 1998 and the creation of the Big Lottery Fund. It was not a civil servant on his way home who dreamt up this concept; the name was suggested by the fund and agreed by the Secretary of State. It was not initiated in the department. It gets across a simple message that this is money from the National Lottery, and that the fund is the biggest of the lottery good-cause organisations. It connects with the public, as I indicated beforehand, with great advantages to the areas for which it is responsible.
	We wanted every possible beneficiary to be aware of the fund's existence and a simple name helps to increase awareness. The name also reflects the aim of reconnecting the public with the National Lottery. We think that it has been advantageous in that regard. It is consumer-oriented, as I think that the noble Viscount would recognise. He might disparage that as a less traditional concept, but it is the people's lottery. Given how much is contributed and how many people are players in the fund, it is proper that we should use popular, easily understood concepts within this framework.
	The fund market tested the name and found that it was popular with all sections of the public. Recent evidence suggests that the recognition of the Big Lottery Fund name is high; it is well known as a source of funding for community projects, an area which our fellow citizens greatly value. I see no reason for changing the name on the grounds of the strong argument which I also advocated on the previous amendment.
	I am also mindful of the fact that the noble Viscount will recognise one aspect, as he is concerned about the accurate allocation of resources. The greatest wastage of resources is when names are changed, logos are messed about with and organisations seek to rebrand themselves with name changes, to no definable purpose. If we changed the name of the Big Lottery Fund, we would spread confusion, achieve very little and use up hard-won resources.

Lord Brooke of Sutton Mandeville: I heard the Minister's speech and his explanation of how the title "Big" was chosen by the New Opportunities Fund and proposed to the Government. If the argument for calling it "Big" was that it was the biggest, the Minister seems to have played into the hands of the argument put forward by my noble friend Lord Eccles. The disadvantage is that it has that central role.
	Opinion polls can be used to prove anything; I heard the figures which the Minister quoted on the previous amendment. I have a recollection—I am perfectly happy to be argued out of it, persuaded or corrected—of a different opinion poll asking people what they thought the money should go to. About a third said that it should go to arts, sport and heritage; a third said it should go on health and education and similar issues; and a third had no opinion at all. I agree that on that basis, the Minister has a degree of argument for the conclusion he has reached, but I do not think it is right to say that the overwhelming majority of people are in favour of what he describes as the "Big" proposition in the way he indicated.

Lord Davies of Oldham: I hear what the noble Lord says but I do not have the benefit of testing what public support there might be for the charitable lottery fund. Therefore, given that we have established this name and it meets with broad approval, I venture to suggest that the case rests with the Government.

Viscount Eccles: I am grateful for the support of my noble friend Lord Brooke. I had in mind not so much the public's reaction but the workings between "Big" and the other lottery distributors. There are a lot of leads in the document that was published: it says that the lottery will have a key role in developing better working between distributors and will administer a joint lottery forum; it will lead on developing networks for building capacity; and it is in a leadership position. The lack of balance between the position of the Big Lottery Fund and the other distributors was, and remains, of concern to me. However, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Clause 13 agreed to.
	Schedule 2 [New Schedule 4A to the National Lottery etc. Act 1993]:

Lord Shutt of Greetland: moved Amendment No. 17:
	Page 19, line 8, leave out "12" and insert "20"

Lord Shutt of Greetland: I referred on Second Reading to the whole business of an English regional dimension. I have the document entitled Our Mission and Values, published by the Big Lottery Fund. It says,
	"the Big Lottery Fund is a new and different organisation, although we wish to build on the experience and best practice of the two lottery distributors, the Community Fund and the New Opportunities Fund, that were merged to create us".
	The document refers to fairness, accessibility, strategic focus, involving people, innovation and enabling an addition to government. It states that the Big Lottery Fund will build on experience, but this Bill does exactly the opposite. Whereas the Community Fund had a splendidly devolved structure, with regional committees throughout England—for example, in Yorkshire and Humberside, the North West, the South West and so on—this is not the plan for the Big Lottery Fund.
	Amendments Nos. 17, 18, 19 and 20 would put back the regional dimension. As one sits here patiently, waiting for an amendment to come up, other thoughts come to mind. Even a few moments ago, the Minister referred to "the people's lottery". I am very happy with that phrase. The noble Baroness, Lady Pitkeathley, is not in her place—few folk are in their places—but she referred to "12 worthy people", who were "agonising". Twelve agonisers are not enough; there need to be more agonisers. If we are talking about a people's lottery, 12 people in charge of £630 million is too few.
	The amendments suggest that the number of people at the centre should be 20 so that somebody from each of the regions would be available to serve on the national body. They also propose regional committees. That would mean more people being involved. That there should be only 12 people on a national board for England in charge of this huge sum of money is a de minimis position. This Bill centralises the dispensation of lottery funds. We had a devolved arrangement previously. I have yet to hear anyone say that the people in the devolved structure got anything wrong, were useless or anything of that nature. Indeed, I have heard the opposite. I know well that people in Yorkshire were very pleased with the Yorkshire committee and some of the innovative work that it was able to do.
	The Minister sent a letter to those of us who expressed an interest in this Bill. He stated that, since the lottery was founded 11 years ago, 229,000 awards, totalling £16.8 billion, have been made. These are huge sums of money. The letter referred to the lottery as a whole, but for that part of the lottery which will represent half of lottery funds, far more people need to be involved.
	The Bill provides for a committee for Scotland, Wales, Northern Ireland, the Isle of Man and the Channel Islands. I suspect that, by Channel Islands, the Bill means one committee for Guernsey and one for Jersey. It is interesting that one of the few aspects of the legislation that we have not debated today—I do not wish to detract from it—is whether there should be a separate body in the Isle of Man and the Channel Islands. We let that go and I am happy for that to be the case, but it seems strange that the Isle of Man, with a population of 75,000, will have its own body dispensing lottery money, yet the Yorkshire and Humberside region, with its huge population, will look to what is described as the "English" region for this purpose.
	Regional accountability is important. It has existed from the formation of the lottery until very recently. If it is good enough for Scotland, Wales, Northern Ireland, the Isle of Man, Guernsey and Jersey, it is good enough for the English regions. I had a meeting with the people who are promoting the Big Lottery Fund. Of course, they said that they would have offices and administrative devolution there but that they would not have local committees. On the basis that there should be genuine devolution of decision-making in the Big Lottery Fund, I beg to move.

Lord Davies of Oldham: The noble Lord expressed himself forcefully at Second Reading on these issues, so I have given careful consideration of the arguments that he puts forward. He raises some interesting questions about how the board is intending to work. Let me address a point that is already in the Bill as we have presented it to Parliament—namely, that four out of the 12 board members should represent the interests of part of the United Kingdom. That ensures that, although they are a minority of members, they have an important part to play, because they will chair committees that will oversee devolved expenditure in the four parts of the UK.
	The National Lottery itself is a reserved matter. But the areas covered by the Big Lottery Fund good cause—health, education, the environment and charities—have all been devolved. Decisions about these matters are better made in the light of the particular circumstances in each country. Our policy has been to reflect this in the Bill, and the arrangements that we have made for the committee, which is why we have created the concept of devolved expenditure and provided for the committees to oversee spending, chaired by each of the country's representatives on the board.
	Devolution to the regions of England is of course a different matter. While it is often a good thing for policy reasons, as the noble Lord will recognise, because he knows how much we have enthused about aspects of regional policy in this Government, there is no statutory framework. He might regret that—but there is a statutory framework with devolution to the countries of the UK. We are reflecting what is rather than what ought to be or what we might in other circumstances have desired.
	We believe that decisions on how best to ensure that there is an English regional dimension to its work are best made by the Big Lottery Fund itself. It is not for the Government to force a particular model upon the fund. The noble Lord proposed an enlarged committee, on which the regional representatives are there—but he also recognises that we would need expertise beyond that, and his answer is to extend the committee. We have thought seriously about the board's size and we think that there are merits in a board of 12, which is small and focused enough to provide a strategic focus for the work. That is what its job is. Having nine English regional appointees as well as the three national interest appointees would risk creating a larger board, but also a less coherent board.
	I respect the noble Lord's points, but the framework of the board as it is builds on the practice of the New Opportunities Fund, which operated very much at a strategic, national level, and the Community Fund, which had much more of a regional focus. The fund will learn from the experiences of both those bodies. It is against this background that the fund has decided it will not have general English regional committees. English programmes will be national and awarded through partner organisations in the third sector or in co-ordination with local government. However, the Big Lottery Fund will have English regional representation on the national committees for individual funding programmes when this is appropriate. For example, the Reaching Communities programme will have representatives from each of the nine English regions, because that reflects rather more the regional concept of the former Community Fund. That will allow for regional perspectives to be brought into the decision making. As the noble Lord conceded, although I do not think he did so with undue enthusiasm, it is intended that there will be a regional office in each of the English regions whose primary role will be outreach work. The offices will spend time gathering regional intelligence that will be fed into the assessment process, which operates nationally.
	I hope the noble Lord will recognise that we have not ignored the regional element with regard to the structure of the fund, but we think a small focused fund concerned with strategy is right. We think we should fit in with the pattern of the United Kingdom in terms of the devolved administrations, which is why we have the four representatives of the four countries of the UK. I hope, despite his undoubted enthusiasm for the regional perspective, that on reflection he will recognise in the structure that we accept part of his argument, and that he will withdraw his amendment.

Lord Shutt of Greetland: I am deeply disappointed at the tone of the Minister's response. I would have hoped for a far more welcome response: telling me that I had just got one or two words wrong which could be tidied up and then the amendment would be fine. I also find it disappointing when he says, "the fund has decided". That is a strange concept. This is supposed to be the Bill that sets up the fund. Frankly, it has no business deciding anything, because it should all be set up by this Bill. It seems quite proper, therefore, that Parliament should decide whether there is an English regional dimension.
	I am also disappointed that the Minister has given no evidence whatever that there is any sense of failure in the way the English regional committees have been involved with the Community Fund. They say they want to build on previous experiences. If the Minister had been able to give a catalogue of failures, that would be one thing, but we have not heard about that. I believe the right thing to do is to have a statutory framework, but there we are. As to a committee of 20, your Lordships' House has plenty of committees with 20 and above. We do not let that worry us too much, and I do not think we should here when it comes to getting a committee that can properly represent a greater number of people in our country. However, we shall think on these things, and for the moment I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendments Nos. 18 to 20 not moved.]
	Schedule 2 agreed to.

Lord Davies of Oldham: I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.
	House resumed.
	House adjourned at three minutes past ten o'clock.